U.S. President Donald Trump cannot fire Federal Reserve Governor Lisa Cook, an appeals court ruled on Monday, allowing her to remain on the central bank's board for a closely-watched policy meeting this week.

The U.S. Court of Appeals for the District of Columbia Circuit in a 2-1 ruling denied the Department of Justice's request to hold an earlier ruling blocking Trump from removing Cook.

Monday's ruling came just a week after a district judge also ruled against Cook's firing. U.S. District Judge Jia Cobb had last week ruled that Trump's allegations of mortgage fraud against Cook, which the Fed governor denied, did not provide sufficient cause for her firing.

Trump is now expected to appeal the case in the Supreme Court.

Cook's attempted firing had sparked heightened concerns over the Fed's independence, given that it was the first time a president has pursued such an action since the Fed's founding in 1913.

Trump has repeatedly badgered the Fed to cut rates, and had even threatened to fire Chair Jerome Powell over the matter.

Monday's ruling comes just before a Fed meeting this week, with the central bank widely expected to cut rates by at least 25 basis points.

But the central bank's outlook on rates remains uncertain, especially in the face of sticky U.S. inflation.

Separately, Trump's nomination to the Fed board, White House adviser Stephen Miran, was approved in a narrow vote by the Senate. Miran will fill in for former governor Adriana Kugler until her seat's term expires in January 2026.

Miran's confirmation will also allow him to attend this week's policy meeting, granting Trump at least three members in the Fed's seven-member rate-setting board.

Source: Investing.com