USD faces pressure as Waller emerges as Fed Chair frontrunner

The US dollar index has softened 0.2% to 104.85 as markets digest the increasing likelihood of Federal Reserve Governor Christopher Waller becoming the next Fed Chair. Waller, known for his pragmatic approach to monetary policy, could potentially signal a shift in Fed dynamics if appointed. His nomination would create two vacant Governor positions, potentially allowing for fresh perspectives on the FOMC. Currency traders are reassessing USD positions as this development could influence the Fed's future policy trajectory. The appointment process typically generates market volatility as investors analyze potential policy implications. Technical indicators show the DXY testing support at 104.80, with resistance at 105.20. A confirmed appointment could trigger repositioning across major USD pairs, particularly EUR/USD and USD/JPY, as markets price in potential policy shifts under new leadership.