Dollar Dips As 30-Year Yield Climbs On Fed Worries: Markets Wrap
Risk appetite received a further knock after Trump renewed his trade brinkmanship, threatening fresh tariffs and export restrictions on advanced technology and semiconductors.

The dollar slipped as traders offloaded longer-dated US Treasuries following President Donald Trump’s bid to oust Federal Reserve Governor Lisa Cook, stoking fears over the long-term outlook for inflation.
The 30-year Treasury yield rose three basis points to 4.92% as the move against Cook stoked concern that inflation could intensify were Trump to reshape the Fed’s policy committee. Two-year yields fell on bets for lower rates. The dollar dipped 0.2%, while S&P 500 futures edged 0.1% lower. Nvidia Corp. rose 0.5% in premarket ahead of its results on Wednesday.
In Europe, the Stoxx 600 retreated 0.6% after French Prime Minister Francois Bayrou called a confidence vote that could bring down his government as soon as next month. France’s CAC 40 index tumbled 1.5% to the lowest in two weeks. The yield premium on French 10-year bonds over German peers widened two basis points to 77 basis points, the most since April.

Lisa Cook.
Risk appetite received a further knock after Trump renewed his trade brinkmanship, threatening fresh tariffs and export restrictions on advanced technology and semiconductors in retaliation against digital services taxes abroad.
Stocks and bonds were already under pressure after the optimism that followed Fed Chair Jerome Powell’s address at Jackson Hole faded on Monday. Doubts about the pace of easing are lingering ahead of an inflation report later this week, expected to highlight sticky price pressures.
“If the Fed is perceived as caving to pressure from the administration and lower rates prematurely to placate the White House, it risks inflation becoming more entrenched,” said Tom Essaye at The Sevens Report. “Since longer-dated yields trade primarily off inflation expectations, this pressure is boosting the 30-year Treasury yield.”
As for France, “the gap in the performance between French and European equities can only grow from here,” said Andrea Tueni, head of sales trading at Saxo Banque France. “The big next step would be the yield on French 10-year bonds topping those of Italy; that would really be a significant milestone.”

For the Fed, swaps imply about an 80% chance of a Fed quarter-point rate cut next month, with at least one more expected by year-end.
Forcing out Cook would give Trump an opportunity to secure a four-person majority on the Fed’s seven-member Board of Governors. Her term wasn’t set to expire until 2038.
Trump said he had “sufficient cause” to fire Cook, the first Black woman to serve on the Fed Board in Washington, based on allegations that she made false statements on one or more mortgage loans.
Cook said Trump has no authority to fire her, and she won’t quit. Cook’s lawyer, Abbe Lowell, said they plan to take “whatever actions are needed to prevent” Trump’s “illegal action.” The Fed declined to comment.
What Bloomberg Strategists Say:
“Risk sentiment will falter further thanks to a barrage of Trump headlines hitting markets that were already shaky. Now, the Fed’s credibility is under the spotlight after Trump sought to remove Lisa Cook. That move signals a wider shakeup may be possible if policymakers fall out of step with the White House. The long end and the US dollar will suffer as Fed independence — long seen as sacrosanct — comes under increasing strain.”
—Mary Nicola, MLIV.
Some of the main moves in markets:
Stocks
S&P 500 futures fell 0.2% as of 7:34 a.m. New York time
Nasdaq 100 futures fell 0.2%
Futures on the Dow Jones Industrial Average fell 0.1%
The Stoxx Europe 600 fell 0.6%
The MSCI World Index fell 0.2%
Currencies
The Bloomberg Dollar Spot Index fell 0.2%
The euro rose 0.3% to $1.1649
The British pound rose 0.2% to $1.3487
The Japanese yen rose 0.2% to 147.53 per dollar
Cryptocurrencies
Bitcoin rose 0.2% to $109,761.12
Ether rose 1.4% to $4,413.26
Bonds
The yield on 10-year Treasuries advanced one basis point to 4.29%
Germany’s 10-year yield declined two basis points to 2.74%
Britain’s 10-year yield advanced five basis points to 4.74%
Commodities
West Texas Intermediate crude fell 1.6% to $63.75 a barrel
Spot gold rose 0.4% to $3,379.22 an ounce