S&P 500 — US Large Cap Index
FTSE 100 — UK Blue Chips
Euro Stoxx 50 — Eurozone Leaders
DAX 40 — German Equities
CAC 40 — French Market Index
Nikkei 225 — Japan Benchmark
Hang Seng — Hong Kong Index
Shanghai Composite — China Mainland
ASX 200 — Australian Market
TSX Composite — Canada Index
Nifty 50 — India Large Cap
STI Index — Singapore Market
KOSPI — South Korea Index
Bovespa — Brazil Equities
JSE Top 40 — South Africa Index
IPC Index — Mexico MarketMarkets have started to rethink some of their USD-bearish Fed independence bets, following several pushbacks against the Department of Justice’s probe into Jerome Powell from Republican lawmakers. Senator Thom Tillis went as far as saying he’ll oppose the next Chair nominee until the matter is resolved, while Treasury Secretary Scott Bessent reportedly flagged the financial market implications of the investigation to Trump, ING’s FX analyst Francesco Pesole notes.
Republican pushback eases political pressure on Powell
“Investors will keep seeking reassurance – ideally from Trump or the DoJ – but the risks of another rapid drop have abated. If the investigation is dropped, there’s a decent chance the dollar may come out stronger from this story. That’s because markets might then perceive Powell as more legitimized (if nothing else to prove a point) in adopting a hawkish stance.”
“Anyway, nerves appear calmer enough today to re-focus on data. We think the dollar faces some upside risks from what we anticipate will be a hotter-than-expected 0.4% MoM December core CPI print (consensus 0.3%). Because of the shutdown, more data collection occurred later in November 2025, a period when Thanksgiving-related discounting is common. Compared with the full month of November 2024, this timing likely skewed that inflation reading lower. Reverting to more standard collection timings in December means risks of a hotter read.”
“A chunk of hawkish repricing already occurred last Friday after the jobs data, and markets increased implied cut probability on the back of the Fed investigation story. This means the upside for the dollar is not huge, but could allow USD crosses to keep edging back towards last Friday’s close.”
