The US dollar slipped and long-term Treasury yields rose modestly Tuesday after President Donald Trump moved to dismiss a Federal Reserve policymaker.
That markets weren’t dramatically upended by Trump’s latest attempt to shape the central bank suggests investors are “not freaking out quite yet,” a Financial Times editor wrote, but that posture is “preposterously sanguine,” given the president’s collective efforts to weaken institutional independence: Trump has said he will soon have a “majority” of his nominees at the Fed who will back him on cutting interest rates.
His current target, Federal Reserve Governor Lisa Cook, said she will sue to block her dismissal, and legal experts have questioned whether Trump’s move has legs.
