In a surprising turn of events, recent dovish comments from Fed officials have sent the US dollar reeling. Initially disregarded, Waller's hints at a possible rate cut in July have gained traction, especially after Bowman echoed similar sentiments.

What’s intriguing is the emergence of two former hawks, both aligned with the Republican party, pivoting towards a more dovish stance. This unexpected shift raises eyebrows and fuels speculation of a MAGA-influenced revolution at the Federal Reserve. Former President Trump has long been a vocal advocate for lower interest rates, pressuring Fed Chair Powell since the moment he took the helm.

Now, with at least two votes leaning into the dovish side, the question looms: will this trend gain momentum? Currently, two dissenting opinions may not significantly sway policies, but it undeniably sets the stage for potential shifts ahead.

Market analysts are reacting swiftly, with probabilities for a July rate cut surging from 15% to 25% following these developments. As anticipation builds, projections suggest 58 basis points of cuts could materialize by year-end and a staggering 117 basis points by October 2026. This wave of optimism is pressuring the US dollar, leading to a sharp decline in USD/JPY as traders recalibrate expectations.

The euro, meanwhile, has stabilized amidst this turbulence, leaving currency traders on edge as they watch these unfolding political and economic dynamics. How this plays out could be pivotal, not just for the dollar, but for the broader global economic landscape.