The dollar index (DXY00) today is down -0.02%. The dollar gave up modest gains today and is slightly lower following dovish comments from Fed Governor Michelle Bowman, who stated that policymakers are in danger of falling behind the curve and need to act decisively to lower interest rates as the labor market weakens. Today’s weaker-than-expected report on Sep S&P manufacturing PMI also weighed on the dollar. The dollar initially moved higher today after the US Q2 current account deficit came in smaller than expected, a supportive factor for the dollar.
The dollar is being undercut by concerns over Fed independence, which could prompt foreign investors to dump dollar assets as President Trump attempts to fire Fed Governor Cook, and by Stephen Miran’s intention to be a Fed Governor while still technically holding his White House job on the Council of Economic Advisors.
