In a high-stakes ruling that expands presidential authority over independent federal agencies, the U.S. Supreme Court had one notable exception, the Federal Reserve.

What Happened: On Thursday, the apex court granted a stay that allows President Donald Trump to remove members of the National Labor Relations Board and the Merit Systems Protection Board without cause, while carving out an exception for the Federal Reserve.

The Court stated that the “arguments in this case necessarily implicat[ing] the constitutionality of for-cause removal protections” do not apply to the Federal Reserve, describing the central bank as a “uniquely structured, quasi-private entity” grounded in the historical tradition of the First and Second Banks of the United States.

Associate Justice Elena Kagan joined Justices Sonia Sotomayor and Ketanji Jackson in slamming the ruling, calling it “puzzling.”

She argued that “the Federal Reserve's independence rests on the same constitutional and analytic foundations” as agencies like the NLRB and FTC, calling the Fed exception a “bespoke” law meant to calm the markets.

The Court’s decision is temporary and is only in effect until the U.S. Court of Appeals for the D.C. Circuit resolves the government’s appeal.

See Also: ‘I’m A Federal Worker Overseas In Fear Of Losing My Job – Should I Stop Paying Into My TSP And Pay Off Debt?’ Suze Orman Weighs In

Why It Matters: Trump has criticized, and even floated the idea of ousting Fed Chair Jerome Powell several times recently, for not cutting rates fast enough.

The markets experienced turmoil for days following these comments, before Trump walked away, stating that he had “no intention” of firing Powell.

Economist Nouriel Roubini criticized Trump for his attacks against Powell, referring to it as “a repeated own goal,” while adding that even if he got his way after winning a Supreme Court battle, it would only be a “pyrrhic victory,” as it would ultimately only lead to higher bond yields, owing to the “de-anchoring of inflation expectations.”

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