The dollar index hovered near 98.3 on Wednesday after retreating in the previous session, pressured by renewed concerns about the Federal Reserve’s independence and weakening confidence in the greenback’s global dominance. Earlier this week, President Donald Trump said he would remove Fed Governor Lisa Cook over allegations of mortgage fraud, though Cook’s lawyer stated she will pursue legal action to block the dismissal. Analysts warned that Cook’s potential ouster could heighten the likelihood of earlier interest rate cuts, with Trump asserting greater influence over the central bank. Markets are now pricing in an 87% probability that the Fed will reduce rates by 25 basis points in September. Looking ahead, investors await Friday’s release of the PCE price index, the Fed’s preferred inflation measure, for additional clues on the policy outlook.