The president’s plan to remove Lisa Cook knocked the dollar last night
Investors sold the US dollar last night in response to a letter posted on Truth Social by President Trump addressed to Lisa Cook, a governor at the Federal Reserve, which announced that she was “hereby removed from [her] position” with immediate effect. The US dollar dropped sharply, with the DXY Index falling nearly 0.4% between 8 and 9 p.m. ET.
Since then, the currency has pared much of those losses, and S&P 500 futures are only down fractionally (-0.1%) as of 5:35 a.m. ET on Tuesday, as Cook says the president has “no authority” to fire her, adding, “I will not resign.”
In his letter, Trump alleged that Cook “may have made false statements on one or more mortgage agreements” and suggested that there is “sufficient cause” to remove the Fed official from her position. Cook, who was nominated to the Fed Board in 2022 by former President Biden, replied in a statement that “no cause exists under the law.”
With the USD and S&P 500 futures having broadly recovered, and the rise of gold has also pared back, it remains to be seen how traders will react to the president’s most pointed attempt yet to reshape the upper echelons of central bank leadership, with much of his focus fixed on Fed Chair Jerome Powell in recent months.
In his letter, Trump alleged that Cook “may have made false statements on one or more mortgage agreements” and suggested that there is “sufficient cause” to remove the Fed official from her position. Cook, who was nominated to the Fed Board in 2022 by former President Biden, replied in a statement that “no cause exists under the law.”
With the USD and S&P 500 futures having broadly recovered, and the rise of gold has also pared back, it remains to be seen how traders will react to the president’s most pointed attempt yet to reshape the upper echelons of central bank leadership, with much of his focus fixed on Fed Chair Jerome Powell in recent months.
