US President Donald Trump on Monday said he is firing US Federal Reserve Governor Lisa, marking an unprecedented attempt to extend presidential influence over the independent monetary body.

Trump announced his intentions in a letter posted on his social media platform, Truth Social. He announced that he was removing Cook from her position, effective immediately, due to allegations that she obtained mortgage funds improperly.

"I have determined that there is sufficient cause to remove you from your position," he said in the letter. Trump went on to describe that Cook had signed two different addresses as primary residences in two different contracts, weeks apart.

He called it a "deceitful and potentially criminal conduct in a financial matter," saying it eroded the American people's trust in her to oversee the Federal Reserve.

What was Cook's reaction?

On Monday night, Cook said that she would not step down from her position. "President Trump purported to fire me 'for cause' when no excuse exists under law, and he has no authority to do so," she said in an emailed statement through her attorney, Abbe Lowell.

"I will not resign," she added.

The allegations against Cook first surfaced last week via Bill Pulte, a Trump appointee to the mortgage regulations agency.

The disagreement is likely to ignite a legal battle that could determine the extent of presidential power over independent institutions.

Currently, the Federal Reserve Act does not permit the removal of a sitting governor "for cause." However, this has not been tested, as presidents typically take a hands-off approach to the institution in order to maintain confidence in US monetary policy.

The Fed is due to hold a policy meeting on September 16-17.

Edited by: Dmytro Hubenko