Judge Temporarily Halts Trump's Financial Directive

A U.S. judge has paused a Trump administration directive aimed at halting federal loans and grants, siding with advocacy groups who argue it is harmful. The decision prevents blocking funding to current programs until February and challenges the administration's authority under First Amendment concerns.

A U.S. district judge has temporarily halted part of a Trump administration directive that aimed to suspend federal loans, grants, and other financial assistance. This pause marks a significant victory for advocacy groups arguing the policy's devastating impact.

Judge Loren AliKhan mandated that funds to existing programs remain unblocked until early February. The ruling follows a lawsuit from the National Council of Nonprofits and other organizations against the directive from the U.S. Office of Management and Budget. The directive, expected to take effect Tuesday, was issued by OMB's acting head.

The groups argue the directive lacked authority and impacted grant recipients' First Amendment rights. Meanwhile, states such as New York and California plan to file lawsuits. OMB's Matthew Vaeth indicated the funds would be reviewed in line with President Trump's priorities.

(With inputs from agencies.)