Unable to Move or Resize a Layer

[ParadiseDogMom]

I am having trouble moving and resizing layers in Photoshop CC. The layer is selected in the layers panel. The Move Tool is also selected. I can see the transform controls. The cursor changes to a double headed arrow when I hover over the center transform boxes on the layer bounding box. BUT, when I go to resize the layer, the Move Tool auto deselects and the layer neither moves nor resizes. It's like the mouse can't "grab" the layer.

[JJMack]

Can you move that small layer using the Arrow keys to nudge that layer.  I had that had problem in PS 2021 version 22 the I could not move layer with my mouse but could nudge them. Resetting photoshop tools did not solve the issue.  I had to restart Photoshop to get the move tool working again.  The are some issues in PS 2021 that effect tools and Photoshop performances that require  you to restart Photoshop to resolve the problems.

[Bojan Živković]

Try wit @JJMack sugestion and if it still does not work try reseting preferences https://helpx.adobe.com/photoshop/using/preferences.html what is general advice for all things weird in Photoshop.