Dollar falls after Trump asks lawmakers if he should fire Jay Powell
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The US dollar fell sharply on Wednesday after Donald Trump asked lawmakers whether he should fire Federal Reserve chief Jay Powell.
A White House official told the Financial Times that Trump asked Republican members of Congress during an Oval Office meeting late on Tuesday whether he should remove the Fed chair.
The White House official said the lawmakers were supportive of the idea.
Anna Paulina Luna, a Republican congresswoman from Florida, posted on X on Tuesday night that she was “hearing” that Powell would get fired, and his firing would be “imminent”.
The White House official disputed that the Fed chair would be removed imminently.
The dollar fell sharply following reports of the previous day’s congressional meeting, sinking 0.9 per cent against a basket of rival currencies. US stocks fell to their lowest level in two weeks.
The move in the dollar and in stocks suggested that investors were selling US assets — even those typically perceived as havens — on the threat to Fed independence.
In the Treasury bond market, the two-year yield, which moves with interest rate expectations, fell as traders bet that Powell’s potential replacement would bow to political pressure and cut interest rates faster than expected under the current regime.
The Fed could not be immediately reached for comment.
This is a developing story
