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Supreme Court’s 5‑4 ruling keeps Lisa Cook on the Fed board; the Fed left its benchmark rate unchanged at 3.5‑3.75% for a fourth meeting, signaling continued
The Supreme Court’s 5‑4 decision on Monday left Lisa Cook in place on the Federal Reserve Board while the president’s attempt to fire her proceeds, and the Fed simultaneously kept its benchmark federal‑funds rate unchanged at 3.5‑3.75% for a fourth straight meeting, matching market expectations [4][3].
| At a glance | |
|---|---|
| Fed rate decision | 3.50‑3.75% (unchanged) |
| Market expectation | In line with consensus |
| Prior rate | 3.50‑3.75% (held at last meeting) |
| Mortgage 30‑yr avg | 6.49% (up from 5.98% earlier 2024) |
| Dollar index | Slightly firmer after court ruling |
The high court rejected President Donald Trump’s bid to remove Cook, a vote split 5‑4 along ideological lines. The majority held that the president failed to provide the procedural protections required by law, rendering the removal “erroneous and void” from the start. Chief Justice John Roberts wrote that the decision protects the Fed’s “unique historical status and role” against political interference. Cook praised the ruling as a reaffirmation of the central bank’s independence, a principle she says is essential for achieving price stability and maximum employment.
On the same day, the Federal Reserve announced that the federal‑funds target range remains at 3.50‑3.75%, the first meeting under new Chair Kevin Warsh and the fourth consecutive meeting at that level. The decision aligned with analysts’ expectations and came despite projections from nine officials that at least one more hike could occur this year. Economic projections showed PCE inflation revised up to 3.6% for 2026, while GDP growth was trimmed to 2.2% (down from 2.4% in March).
Higher‑rate expectations are already feeding into mortgage markets. The average 30‑year fixed mortgage rate rose to 6.49% in the week to June 25, up from a low of 5.98% earlier this year, a move Morgan Stanley strategists attribute to Warsh’s hawkish stance and the broader expectation of sustained higher rates [2]. Analysts warn that reduced forward guidance from the Fed could increase volatility in mortgage‑backed securities, further pressuring mortgage rates.
The court’s affirmation of Cook’s tenure underscores the political safeguards around the Fed, while the unchanged rate signals a cautious approach amid elevated inflation and a housing market strained by high mortgage costs. How the Fed balances these pressures in its next meeting will shape both monetary policy and broader financial conditions.
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AI-assisted synthesis by the TrendWatcher Editorial Desk · sourced from 4 outlets · Jun 29, 2026 · How we report
It is the interest rate at which banks and credit unions lend reserve balances to each other overnight on an uncollateralized basis.
The effective federal funds rate is the median interest rate of overnight federal funds transactions from the previous business day, published daily by the Federal Reserve Bank of New York.
The Federal Open Market Committee (FOMC) sets the target range, typically meeting eight times a year and using various tools to align the effective rate with that range.
It serves as a benchmark for financial markets and influences broader market interest rates, affecting employment, economic activity, and inflation.
A Supreme Court decision allowed Fed Governor Lisa Cook to remain in her position while legal challenges over her attempted removal—linked to her stance on interest‑rate policy—proceed.