The White House Office of Management and Budget on Wednesday rescinded a memo that froze federal grants and loans and created widespread confusion this week.

The Trump’s administration’s Office of Management and Budget released a new memo Wednesday rescinding a controversial memo issued late Monday that froze a wide swath of federal financial assistance, which had paralyzed many federal programs and caused a huge uproar on Capitol Hill.

President Donald Trump's budget office on Wednesday rescinded a memo freezing spending on federal loans and grants, less than two days after it sparked widespread confusion and legal challenges across the country.

The first major domestic policy reversal of the Republican president's new term came after one federal judge had temporarily blocked the freeze and before another judge was due to

The Trump administration has put a hold on all federal financial grants and loans, affecting tens of billions of dollars in payments.

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.

The Trump administration has temporarily paused grant, loan and other financial assistance programs at the Office of Management and Budget, according to a memo seen by Reuters, prompting criticism from congressional Democrats.