Major currencies hit the reset button on the day after the earlier Trump-Fed dramaCredit Agricole also now expects the Fed to cut rates twice by year-endWeak dollar selling the signal this month-end – BarclaysFrench shares lead the drop at the open in Europe todayFrance August consumer confidence 87 vs 89 expectedFrench stocks set for another steep drop at the open as political crisis weighsEurostoxx futures -0.4% in early European tradingFed to cut rates twice by year-end now – Morgan StanleyThe US yield curve continues to steepen post-Jackson HoleJapan trade negotiator says “no comment” on supposed $550 billion US investmentDollar claws back losses as Fed governor Cook stands her groundFed’s Cook says will not resign and Trump has no authority to fire her
It’s been a very boring session with no data or important news releases. Understandably, the price action has been rangebound throughout the session as markets await US labour market data to influence interest rates expectations.
Today’s main news was Trump’s attempt at firing Fed Governor Cook, although he has no authority to do that. This is the usual Trump-Fed noise that the markets learnt to ignore.
I don’t know anything about laws in this particular case but reading opinions from experts it looks like Trump is not going anywhere with Cook. First, the alleged fraud happened before her nomination and it would therefore disqualify her from being fired “for cause”. Second, the Supreme Court back in May (if I recall correctly) already said that the President’s authority to fire the Fed Chair or Governors is limited.
This morning, Fed’s Cook said that Trump has no authority to fire her and she won’t quit. I would personally ignore this latest attempt to fire a Governor and focus on what really matters: US labour market data ahead of the crucial NFP report next week. That’s what’s going to influence interest rates expectations and move the markets.
This article was written by Giuseppe Dellamotta at investinglive.com.