Dollar Falls on Report Trump to Name Fed Replacement Early

A report that President Donald Trump may announce a replacement for Federal Reserve Chair Jerome Powell by September or October pushed down the US dollar as investors saw it as a sign that early rate cuts were becoming more likely. Such an appointment, reported by the Wall Street Journal, would be unusually early considering Powell’s term as chair ends in May 2026.

Trump has often lashed out at the Fed’s position to keep rates on hold, arguing for cuts and saying the central bank is making borrowing costs for the US government too high. This combative relationship has fueled uncertainty over the outlook for interest rates at a time when markets are weighing up a series of mixed economic signals. Trump said on Wednesday that he had three or four people in mind to succeed Powell. “Trump has been talking about lower rates so he will pick someone who aligns with his views,” said Mahjabeen Zaman, head of FX research at ANZ Banking Group. “Whoever he announces will likely be dovish and will likely give further downside impulse to the dollar.”