Core Viewpoint - The U.S. Federal Reserve is expected to maintain its key interest rate through the current quarter and possibly until Chair Jerome Powell's term ends in May, a shift from previous expectations of rate cuts by March [1][4]. Economic Outlook - The U.S. economy is projected to continue growing strongly, with a growth rate of 4.3% in the third quarter and an expected expansion of 2.3% this year, up from 2.2% last year [8]. - Inflation remains above the Fed's target of 2%, which argues against near-term rate cuts, although economists anticipate at least two reductions later in the year [2]. Federal Reserve Policy - A majority of economists (58%) expect the Fed to keep rates at 3.50%-3.75% during the January meeting, contrasting with last month's expectations for at least one reduction [4]. - There is a divided outlook among Fed policymakers, with a slight majority (55 out of 100) expecting rate cuts to resume after Powell's term ends in May [6]. Political Influence - President Trump has criticized Powell for not lowering rates aggressively and has initiated criminal charges against him related to Fed headquarters renovations, which may impact the Fed's independence [3][7]. - The selection of the next Fed chair is anticipated to face significant pushback due to ongoing investigations, potentially affecting future interest rate decisions [7].

Core Points - The US Supreme Court has decided that Lisa Cook will remain as a Federal Reserve governor, deferring action on the Department of Justice's request for her immediate removal, which aligns with Donald Trump's efforts to influence the US central bank [1][3] - This case marks the first attempt by a US president to remove a Federal Reserve official, challenging the independence of the central bank [2] - The court will hear oral arguments regarding this case in January, while Cook's position is temporarily protected by a lower court's ruling [1][3] Legal Context - The Federal Reserve Act of 1913 was designed to protect the central bank from political interference, allowing for the removal of governors only "for cause," although the term is not defined in the law [4] - A ruling by US District Judge Jia Cobb indicated that Trump's allegations against Cook regarding mortgage fraud were likely insufficient grounds for her removal under the Federal Reserve Act [5] Background on Lisa Cook - Lisa Cook is the first Black woman to serve as a Federal Reserve governor and has filed a lawsuit against Trump after he announced his intention to remove her, arguing that the claims made against her do not provide legal grounds for her dismissal [6]