The big dovish shifts from Bowman and Waller seem to have caught the market’s attention and led to a drop in the US dollar. Last week, the market mostly ignored Waller floating a July rate cut but now he’s been joined by Bowman and it looks like more of a trend.

Now, maybe it’s just a coincidence that two former hawks who are also Republicans are suddenly doves but it’s starting to look like a MAGA takeover of the Fed. And if there’s one thing Trump has been consistent about through his entire career (and it might only be one single thing), it’s that he likes low interest rates.

He has badgered Powell to cut rates almost since he appointed him and now he has at least two voters at the Fed on his team. What happens next is tough to say as two votes doesn’t really move the needle.

In terms of pricing, the July meeting is up to 25% now from 15% after Waller. There are 58 bps of cuts priced in for year-end and 117 bps by October 2026. With that, the US dollar is under some significant pressure since the comments. USD/JPY has given back a big chunk of today’s gains.

The euro is now also flat.