The White House Office of Management and Budget on Wednesday rescinded a memo that froze federal grants and loans and created widespread confusion this week.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

WASHINGTON - The White House Office of Management and Budget has rescinded a Trump administration directive pausing federal loans, grants and other financial assistance, the White House confirmed on Wednesday.

The White House budget office on Wednesday rescinded an order freezing federal grants, according to a copy of a new memo obtained by The Washington Post, after the administration’s move to halt spending earlier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

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.

The full extent of the order was not immediately clear, but the directive sent to government agencies on Monday threatened to paralyze a vast swath of federal programs.

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