Dollar Nears Low as Trump Pushes Fed for Rate Cut
Dollar Nears Two-Month Low as Trump Presses Fed for Bigger Rate Cut
The U.S. dollar slipped close to a two-month low against the British pound on Tuesday, as investors braced for another Federal Reserve rate cut and U.S. President Donald Trump renewed pressure for more aggressive monetary easing.
Markets widely expect the Fed to trim rates by at least 25 basis points at its policy meeting on Wednesday, with a small chance of a larger 50 basis-point cut. Projections suggest further reductions totaling 67 basis points by year-end, rising to 81 basis points by January.
Trump, in a social media post on Monday, urged Fed Chair Jerome Powell to deliver a “bigger” cut, citing the housing market as a key reason.
Recent signs of weakness in the U.S. labor market have fueled expectations of deeper rate cuts. The softer economic outlook has dragged the dollar and bond yields lower while lifting Wall Street to fresh record highs on Monday.
“There’s a growing view that the Fed is behind the curve and needs to step up its pace to bring rates back to neutral,” said Chris Weston, head of research at Pepperstone. He added that many investors now expect multiple cuts this year and possibly into January.
In early Asian trading, the euro was little changed at $1.1765, near last week’s high of $1.1780 — the strongest since late July. Sterling steadied at $1.3605 after briefly touching $1.3621, its highest since July 8.
The Australian dollar held at $0.6672, just under Monday’s peak of $0.6674, the highest level since November 8. Meanwhile, the greenback was flat at 147.42 yen.
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