The White House Office of Management and Budget on Wednesday rescinded a memo that froze federal grants and loans and created widespread confusion this week.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 freeze on hundreds of billions of dollars of federal grants had been temporarily halted by a judge on Tuesday.

The White House budget office on Wednesday rescinded an order freezing federal grants, according to a copy of a new memo obtained by The Washington Post, after the administration’s move to halt spending earlier this week provoked a backlash.

Donald Trump's administration has rescinded its sweeping directive that sought to pause potential trillions in loans, grants, and financial assistance, according to a memo obtained by ABC News.

WASHINGTON - The White House Office of Management and Budget has rescinded a Trump administration directive pausing federal loans, grants and other financial assistance, the White House confirmed on Wednesday.

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 sparked uncertainty over a crucial financial lifeline for states, schools and organizations that rely on trillions of dollars from Washington.