Yesterday, Treasury Secretary Scott Bessent reiterated his call for Federal Reserve Chair Jerome Powell to conduct an internal review of the central bank, citing allegations of mortgage fraud against Fed Governor Lisa Cook as one of the issues that should be included in the probe. "I urged Chair Powell to handle this internally before an external review takes place," Bessent said in an interview. "These are the issues that need to be addressed," he added, referring to Cook's case.

Bessent's statement resonated in political and financial circles. This move underscores the growing tension between the executive branch and the independent central bank, raising questions about the Fed leadership's transparency and accountability. The accusations against Lisa Cook have already added further uncertainty and could undermine confidence in one of the key institutions shaping the country's economic policy.

A Treasury Secretary's call for an internal Fed review is unusual, given the central bank's traditional autonomy. However, Bessent argues that his position is based on the need to restore trust in the financial system and ensure its stability. This is particularly important in the current environment of elevated inflation and recession risk.

So far, the Fed's response has been cautious. Central bank representatives have refrained from commenting directly on the accusations against Cook or the call for a review. However, observers believe Powell will need to act to protect the Fed's reputation and safeguard its independence under mounting political pressure. The next steps by both sides will determine how the situation unfolds.

It is worth recalling that on Monday, U.S. President Donald Trump decided to remove Cook from her post as governor after the administration accused her of mortgage fraud.

When asked whether Cook's dismissal was part of Trump's plan to secure a majority of his nominees on the Fed's Board of Governors, Bessent responded that all Fed governors are independent.

It should be noted that the current board includes Christopher Waller and Michelle Bowman—both appointed by Trump during his first term and clearly loyal to the current president. Trump has already nominated White House Chief Economist Steven Miran to Cook's vacated board seat.

In the interview, Bessent stated that the administration does not tell Waller or Bowman how to vote. Last month, both governors opposed the Fed's decision, supporting an interest rate cut, while other voters chose to stick to their positions.

Bessent also said that the process of selecting Powell's successor—whose term expires in May—is ongoing. He added that he would interview candidates after Labor Day and then, together with other administration officials, present Trump with three to four names. According to him, the candidate chosen by the president will "almost certainly" be announced in the fall.

As for the current technical picture of EUR/USD, buyers now need to focus on taking the 1.1660 level. Only this would allow for a test of 1.1700. From there, the pair could move toward 1.1740, though achieving this without support from major players will be difficult. The furthest target is the 1.1780 high. In case of a decline, I expect strong buying activity only around 1.1620. If there is no support at that level, it would be better to wait for a retest of the 1.1575 low or consider long entries from 1.1530.

As for the current technical picture of GBP/USD, pound buyers need to break the nearest resistance at 1.3525. Only then would a move toward 1.3560 be possible, though breaking above it will be quite challenging. The furthest target is the 1.3590 level. In the event of a decline, the bears will attempt to regain control at 1.3485. If successful, a breakout of this range would deal a serious blow to the bulls and push GBP/USD down to the 1.3450 low, with prospects of extending the move to 1.3420.