The USD is lower to start the new trading day as the ups and downs continue. | investingLive

The US dollar is lower versus the major currencies reversing some of the gains seen from yesterday, which reversed some of the the declines from Friday after Fed chair Powell’s speech at Jackson Hole. The ups-and-downs have traders grasping for some sort of clues that might give them an edge (i.e. Defining risk / define bias). In the video, explain the technical levels in play that define risk and bias.

In overnight news, President Donald Trump announced that he had fired Federal Reserve Governor Lisa Cook, accusing her of deceitful and potentially criminal conduct tied to alleged false statements in mortgage filings. He claimed authority under the Federal Reserve Act to remove her “for cause.” Cook, the first Black woman to serve on the Fed’s Board, rejected both the allegations and the assertion that the president had the legal power to dismiss her. She refused to resign, pledged to continue her duties, and signaled plans to contest the action in court.

Legal experts have questioned the legitimacy of Trump’s move, noting that removal for cause usually applies to misconduct during service, not matters predating appointment, and that her background had already been vetted by the Senate.

The firing raises the concerns about political interference in the central bank and is expected to set up a legal battle that could carry significant implications for the Fed’s independence, with markets reacting cautiously to the uncertainty. Of concern, is if the board is manipulated by Pres. Trump sympathizers, the board could vote to reclassify the regional board presidents as all nonvoting members. Perhaps they could vote to have more appointed members of the board to replace them, and to in essence make the Fed, de facto under the president; control (while remaining “indepedent”).

In other Fed news, Fed’s Logan (2026 voter) said the central bank should be cautious not to over-emphasize the median view at the expense of the diversity of perspectives within the Fed. She noted that communications could be improved, particularly around the balance sheet, and emphasized the importance of assessing whether it remains optimal to continue communicating a range for the Fed funds rate target.

In Australia, the Reserve Bank of Australia minutes from the August meeting revealed that the board saw a strong case for a 25bps cut in the Cash Rate, with further reductions likely over the coming year. Policymakers judged that the stance of policy remained somewhat restrictive, and that the pace of easing would depend on incoming data and global risks. While the labour market was still considered tight, inflation remained above the midpoint of the target and domestic demand was recovering, leading the board to weigh arguments for both a gradual and a faster pace of easing. Members acknowledged that faster cuts might be necessary if labour market conditions risked inflation undershooting the midpoint, but overall the balance of risks was viewed as tilted to the downside due to global uncertainties. Staff forecasts continued to support the achievement of full employment and inflation targets. The housing market was assessed as stable, with price increases consistent with past easing cycles and homebuilding activity showing improvement. Risks from US tariff policy persisted, although the worst outcomes had been avoided. On balance sheet policy, the board decided not to accelerate the reduction of government bond holdings, opting instead to continue allowing bonds to mature at their natural pace.

Like other currency pairs, the AUDUSD has seen up and down swings in trading today despite the dovish assessment..

The major US stock indices are trading modestly lower: