Dollar Falls as Trump Mulls Naming Fed Chair Early
Bloomberg’s gauge of the dollar slipped to a three-year low after the Wall Street Journal said President Donald Trump is considering accelerating when he will announce the next chair of the Federal Reserve.
The Bloomberg Dollar Spot Index dropped as much as 0.4% to take losses into a fourth day. Investors will read the prospect of Trump naming a new Fed chair by October as a signal that early interest-rate cuts are more likely.
The President said separately he has three or four people in mind to succeed current Fed Chair Jerome Powell when his term expires next year.
“The increasing risk of Powell becoming a lame duck FOMC chair earlier than expected is weighing on the dollar,” said David Forrester, a senior strategist at Credit Agricole CIB in Singapore.
The euro breached 1.1700 as traders triggered large EUR/USD option barriers beginning at 1.17 and above.
EUR/USD gained 0.2% to 1.1682; USD/JPY slid 0.4% to 144.63.
GBP/USD rose 0.3% to 1.3702; USD/CHF fell 0.2% to 0.8033.
Treasury 10-year yields fell two basis points to 4.27% on bets that rate cuts will come sooner than expected.
Source: Bloomberg
