The US dollar will fall further along with other US assets if Fed Chairman Jerome Powell leaves office early due to pressure from President Trump.
Trump had hinted last week that he might fire Powell if he wished, criticizing the Fed chairman for not cutting interest rates, as he renewed Trump's calls for lowering interest rates in a post on his Truth social platform, said there was little inflation, and warned that the US economy would slow down if the Fed did not immediately cut interest rates.
We expect that this will increase the fears of market participants who were already pessimistically regarding the dollar as a safe haven and reserve currency, given the chaotic manner in which the White House has been acting since the advent of Trump, which could undermine the credibility of the Fed and weaken investor confidence in the dollar.
The dollar has fallen by about 6% this month, recording its biggest losses against the euro, yen and Swiss franc.
It is slightly higher today, but the US dollar is still under pressure after reaching a three-year low on Monday.
Meanwhile, the markets were disappointed by the lack of progress in trade talks, as China accused the United States of abusing tariffs, and warned other countries not to conclude an agreement with Washington at its expense.
