Yields, Dollar drop after Trump removes Fed Governor Lisa Cook

[Modern Financial Background with $100 Bills and Statistics]
kdrkara

Treasury yields and the U.S. dollar (DXY [https://seekingalpha.com/symbol/DXY]) fell on Tuesday after President Donald Trump removed Federal Reserve Governor Lisa Cook from her post.

Two-year yields (US2Y [https://seekingalpha.com/symbol/US2Y]) fell after Trump took the unprecedented step [https://seekingalpha.com/news/4489007-trump-fires-fed-fed-governor-lisa-cook], on speculation that the Fed will cut interest rates as soon as next month. The yield on the 30-year meanwhile climbed on concern that looser monetary policy would risk fueling inflation.

Trump said in a letter posted on his Truth Social platform that he is firing Cook because of allegations that she committed mortgage fraud. Bill Pulte, a Trump appointee to the agency that regulates mortgage giants Fannie Mae and Freddie Mac, made the accusations last week.

The US dollar (DXY [https://seekingalpha.com/symbol/DXY]) index fell 0.2% against its rivals.

The pullback came after the U.S. currency registered its biggest daily gain of the month on Monday.

"I cannot currently think of a scenario in which the dollar suddenly appreciates massively and regains its “old strength” (also because of structural factors – think of the discussion about the independence of the Fed, which has gained momentum again with the affair surrounding Governor Lisa Cook, or the fiscal position of the US, which will deteriorate with Trump's plans)," Commerzbank's FX analyst Antje Praefcke said.

Dollar-Based ETFs: (UUP [https://seekingalpha.com/symbol/UUP]), (USDU [https://seekingalpha.com/symbol/USDU]), and (UDN [https://seekingalpha.com/symbol/UDN]).

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