Democrats declared victory for blunting Trump’s momentum while the White House insisted it isn’t backing down.

The new memorandum, just two sentences long, will allow agencies to continue their normal operations after uncertainty over the impact of the initial directive caused widespread chaos across government. It followed a temporary injunction by a federal judge that prevented the original Office of Management and Budget memo from taking effect.

The order is "a potential five-alarm fire" for organizations that serve communities, nonprofit group executive says.

Officials said the decision to halt loans and grants was necessary to ensure spending complies with recent executive orders.

The White House Office of Management and Budget has rescinded a Trump administration directive pausing federal loans, grants and other financial assistance, a White House official said on Wednesday. (Reporting by Jeff Mason and Jasper Ward) Copyright 2025 Thomson Reuters.

White House press secretary Karoline Leavitt vehemently defended the administration’s sweeping freeze on federal aid, arguing Tuesday in her first press briefing that it was critical to scrutinize the scope of the government’s spending.

Nutrition programs that deliver food assistance to millions of U.S. families will not be affected by a White House pause on federal grants and loans, a senior official said on Tuesday. The White House's Office of Management and Budget said in a memo on Monday that federal grants and loans would be put on hold for review to ensure the programs were aligned with President Donald Trump's priorities,