The White House Office of Management and Budget on Wednesday rescinded a memo that froze federal grants and loans and created widespread confusion this week.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The White House budget office on Wednesday rescinded an order freezing federal grants, according to a copy of a new memo obtained by The Washington Post, after the administration’s move to halt spending earlier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.

WASHINGTON - The White House Office of Management and Budget has rescinded a Trump administration directive pausing federal loans, grants and other financial assistance, the White House confirmed on Wednesday.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 is "a potential five-alarm fire" for organizations that serve communities, nonprofit group executive says.

At least three U.S. lawmakers said on Tuesday healthcare providers were blocked from the Medicaid payment portal after the Trump administration announced a federal funding pause, even as the White House said the program was exempted.

President Donald Trump‘s administration sought to tamp down confusion over Medicaid funding in the wake of Office of Management and Budget director Matthew Vaeth’s memorandum pausing federal grant funding.

A funding freeze ordered by the Trump administration has sparked widespread confusion about its effects on government programs such as Medicaid.