An appeals court has blocked Donald Trump’s attempt to fire Lisa Cook, the governor of the US Federal Reserve, in the latest step in a legal battle that threatens the central bank’s longstanding independence.

The president previously ordered Ms Cook’s removal over untested allegations of mortgage fraud, which she denies.

It marked the first time in the Federal Reserve’s 111-year history that a president has sought to remove one its governors.

On Monday, the US Court of Appeals for the District of Columbia Circuit ruled that Ms Cook can keep her seat ahead of the Fed’s policy meeting on Tuesday and Wednesday where it is expected to cut interest rates to shore up a cooling labour market.

The ruling came on the same day that the US president expanded his influence over the world’s most important central bank after Stephen Miran, his top economic advisor, was handed one of 12 interest-rate-setting votes on the eve of the key policy meeting.

In a blow to Mr Trump, the DC Circuit denied the Justice Department’s request to put on hold a judge’s order temporarily blocking the Republican president from removing Ms Cook, an appointee of former president Joe Biden.

The decision was 2-1, with Circuit Judges Bradley Garcia and J. Michelle Childs in the majority, both of whom were appointed by Mr Biden. Circuit Judge Gregory Katsas, a Trump appointee, dissented.

The Trump administration is expected to appeal to the US Supreme Court.

US District Judge Jia Cobb had ruled on September 9 that Mr Trump’s claims that Ms Cook committed “deceitful and criminal conduct in a financial matter” before taking office likely were not sufficient grounds for removal under the law that created the central bank.

Ms Cook denies wrongdoing and is in the process of suing Mr Trump.

Trump advisor appointed to Fed board

Just before the decision about Ms Cook was announced, the Republican-controlled Senate narrowly confirmed Mr Miran to the Federal Reserve’s Board of Governors.

It 48-47 vote marked the final step of a swift process that began in August when Adriana Kugler resigned unexpectedly as a Federal Reserve governor.

That created an opening on the seven-member board for Mr Trump to fill with someone more amenable to lowering interest rates, as the president has demanded for all year.

Lisa Murkowski, a senator for Alaska, was the lone vote against Mr Miran from Republicans.

It typically takes months for a Federal Reserve governor nominee to be confirmed by the Senate, however Mr Miran was confirmed in fewer than six weeks.

The swift action means Mr Miran will be able to take part in the central bank’s policy meetings beginning Tuesday, pending the completion of paperwork and his swearing-in.

Policymakers are expected to approve a quarter-percentage-point rate cut to support a weakening labour market at the end of the meeting on Wednesday.

Analysts anticipate that Mr Miran will dissent on the policy decision in favour of a bigger rate cut, though not necessarily the several-percentage-point reduction that Mr Trump has demanded.

As the head of the White House’s Council of Economic Advisers, Mr Miran has repeatedly said he believes the Republican president’s hefty import tariffs won’t cause inflation and that the president’s other policies, including his immigration crackdown, will ease broad price pressures by reducing demand for housing.

As the newest Federal Reserve board member, Mr Miran would have responsibilities that extend beyond voting on interest rates. Governors typically serve on several committees with remits including US financial regulation and supervision, community banking, and staffing and budget decisions for the US central bank’s system as well as its 12 regional banks.

Mr Miran will retain his White House job but go on unpaid leave while he serves at the Federal Reserve for a term that expires on January 31, although he could stay on indefinitely if a successor for his seat has not yet been picked and confirmed.

Democrats say the arrangement makes him a Trump “puppet,” a charge that Mr Miran denies.