Dollar slides as Trump eyes new Fed boss
Dollar slides as Trump eyes new Fed boss
The US dollar hit its lowest level since March 2022. File photo: Reuters
The US dollar hit a three-year low on Thursday as US President Donald Trump eyed candidates to succeed Federal Reserve boss Jerome Powell, fueling bets of cuts to US interest rates.
But Wall Street rose handsomely, lifting the S&P 500 to near a closing record, following solid earnings from chip company Micron and a signal that the White House could extend an upcoming tariff deadline on trading partners.
Trump had suggested Wednesday that he was lining up Powell's replacement ahead of an expected departure next year.
"No decisions are imminent, although the president has the right to change his mind," a White House official told AFP.
The Dollar Index, which compares the greenback to a basket of major currencies, hit its lowest level since March 2022 at 96,997 points.
The pound meanwhile reached its highest level against the dollar since October 2021.
"Concerns over the Federal Reserve's independence and growing expectations for monetary easing weighed on the currency," said George Pavel, general manager at Naga.com Middle East, a trading platform.
"The move, if confirmed, would raise serious questions about the central bank's autonomy at a time of heightened policy uncertainty, painting a bearish scenario for the greenback," Pavel said.
Since returning to the White House, Trump has constantly hit out at Powell for not cutting US interest rates and questioned his intelligence, stoking worries about the bank's independence.
"I know within three or four people who I'm going to pick," Trump told reporters after a NATO summit.
The Wall Street Journal reported that Trump could announce a replacement as early as September, with Treasury Secretary Scott Bessent, economic adviser Kevin Hassett and former Fed governor Kevin Warsh among the contenders.
Earlier this week, Powell told lawmakers the bank would assess the impact of Trump's tariffs on the economy before making any rate move. (AFP)
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