The Federal Reserve's independence faces a "trial of the century": its credibility is in jeopardy.

This week, the Federal Reserve faces its most severe test of independence in its 100-year history. This test will not only determine the fate of one official but also whether the Fed will become the "backyard" of the US president. The case revolves around Trump's attempt to fire Fed Governor Cook on allegations of mortgage fraud. In extreme cases, this case could erode the Fed's cherished independence; even if it doesn't reach that point, it could provide the first "operational guide" on how a president can remove someone from this tightly guarded central bank. Fireing a Fed governor should be difficult, a principle embodied in the requirement of "just cause" and the 14-year term, although few serve that long. Monetary policy decisions can sometimes have painful short-term economic consequences, which is often detrimental to officials bound by two- or four-year election cycles. (Jinshi)