U.S. Dollar Rallies as Biden Nominates Powell as Fed Chair
By Sam Boughedda
The US Dollar Index has rallied Monday after U.S. President Joe Biden formally announced he will nominate Jerome Powell to serve as the chairman of the Federal Reserve for a second term.
Powell is set to end his current four-year term in February, and there was much speculation about who Biden would nominate before today’s announcement.
Biden will also nominate Lael Brainard, the other candidate for the top job, as vice-chair.
The DXY hit a high of 96.239 in reaction to the news, with the EUR/USD falling as low as 1.1236 and XAU/USD seeing the strongest move, dropping around $28.
The dollar’s strength is a reaction to the continuity that Powell will provide; however, there is also the fact that many considered Brainard to be even more dovish than the current Fed chair.