Dollar Rises for Second Consecutive Day on Fed Chair Speculation

The U.S. dollar advanced Monday (February 2, 2026), extending gains from Friday after President Trump nominated former Fed governor Kevin Warsh as the next Federal Reserve chair. The ICE U.S. Dollar Index (DXY) rose 0.7% to 97.65 in New York trading—the first back-to-back daily gains since January 16. Warsh’s nomination triggered a sell-off in precious metals and risk assets late last week, boosting the dollar. While seen as dovish on interest rates, Warsh has previously criticized the Fed’s balance sheet expansion. However, Wells Fargo analysts led by Tom Porcelli argued that a major balance sheet reduction under Warsh is unlikely due to the entrenched “ample reserves” framework. Meanwhile, the U.S. January jobs report was delayed due to a partial government shutdown. In Europe, EUR/USD fell 0.5% to 1.1785, while GBP/USD dipped to 1.3658.