The U.S. dollar initially weakened by up to 0.3%, and gold prices rose by 0.6% after President Donald Trump attempted to oust Federal Reserve Governor Lisa Cook over allegations of falsified mortgage documents.
However, the dollar later recovered most of its losses, and gold trimmed its gains after Cook vowed not to resign.
Trump’s move, which cited “sufficient cause” due to the mortgage fraud allegations, raised concerns about the Federal Reserve’s independence, as Cook’s removal could allow Trump to secure a majority on the Fed’s seven-member Board of Governors.
Broader market sentiment was further dampened by Trump’s ongoing tariff war and a widening U.S. deficit, fueling a “Sell America” narrative and prompting traders to seek alternatives to the dollar and Treasuries.
Trump also posted on his Truth Social platform, shortly after the Cook announcement, that the U.S. will impose substantial additional tariffs on all countries with digital taxes, legislation, rules, or regulations.
U.S. stocks faced additional pressure as optimism about Federal Reserve rate cuts faded, and markets braced for a higher-than-expected inflation reading.
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Bitcoin rose 0.7% to $110,354.61
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Ether rose 2.1% to $4,444.65
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Spot gold rose 0.3% to $3,375.68
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Crude fell 0.6% to $64.43
U.S. Durable Goods Orders, CB Consumer Confidence, and the Richmond Manufacturing Index will be the most impactful data releases today.
In the evening, BoC Governor Macklem is scheduled to speak.
