Moments after Jerome Powell’s latest speech, Trump threatens to fire Fed governor Lisa Cook if she doesn’t resign

The growing threat to central bank independence

Nick Lichtenberg is Fortune Intelligence editor and was formerly Fortune's executive editor of global news.

Moments after Federal Reserve Chair Jerome Powell’s closely watched speech at the Jackson Hole symposium on Friday, President Donald Trump dramatically escalated his ongoing assault on the central bank’s leadership

As reported

Powell’s speech had signaled potential openness to rate cuts, but emphasized that the Fed was in a tough spot, caught between rising inflation and signs of waning strength in the labor market. Bank of America Research has noted that it’s rare for the Fed to cut rates in an environment of rising inflation. It’s only happened 16% of the time in records dating back to 1973, and the last time it happened was the second half of 2007, shortly before the onset of the Great Financial Crisis.

Cook, who is the first Black woman on the Fed Board, was accused

Cook fired back in a public statement Wednesday, declaring, “I have no intention of being bullied to step down from my position because of some questions raised in a tweet,” and affirming her intent to cooperate fully with any legitimate inquiry. The Department of Justice has signaled that it will open a probe into the accusations, adding another layer of uncertainty to the Fed’s leadership and the ongoing political spectacle around the institution.

Analysts warn that Trump’s escalating pressure on Fed personnel—combined with his repeated attacks on Powell and his vow to appoint only officials willing to cut rates—threatens the independence of the central bank, which is structured to insulate its seven-member Board from direct executive influence. Appointees can only be removed “for cause,” such as proven misconduct, not mere policy disagreement.

If Cook were to resign or be forced out, Trump would gain another opportunity to appoint a loyalist before the next presidential election, potentially tipping the balance of the Board further in his favor. Treasury Secretary Scott Bessent has confirmed that a process is under way to select Powell’s successor.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.