A note from MUFG on Trump’s war on the US Federal Reserve:
- The relatively limited dollar decline so far partly reflects doubts over whether Trump’s move to fire Fed Governor Cook will hold up legally.
- Even so, the action represents a clear escalation in Trump’s assault on the Fed’s independence.
- This raises the risk that the U.S. dollar could face a larger selloff down the line.
- Adding to the case for further dollar weakness are Powell’s remarks on Friday, which signalled the Fed is edging closer to cutting rates again.
This article was written by Eamonn Sheridan at investinglive.com.