*

Trump fires Fed governor Lisa Cook, impacts dollar and

Treasuries

*

Trump's actions raise concerns over Fed's independence

*

Market uncertainty rises over Fed policy and potential

rate cut

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Major brokerages predict 25-basis-point Fed rate cut in

September

(Updates prices; adds tariff details in paragraphs 3, 16 and

analyst comment)

By Rocky Swift and Kevin Buckland

TOKYO, Aug 26 (Reuters) - The dollar and longer-dated

U.S. Treasuries slid on Tuesday after President Donald Trump

announced he was firing a Federal Reserve governor, an

unprecedented move that further undermines confidence in the

Fed's independence and U.S. assets.

The U.S. currency fell against the yen and euro after Trump

said he was removing Lisa Cook from her position on the Fed's

board of directors, citing allegations of improprieties in

obtaining mortgage loans and escalating the president's battle

against the central bank.

Stock markets in Asia followed declines on Wall Street as

the news muddied the outlook for Fed policy and stoked

uncertainty over prospects for a rate cut next month. Gold

touched a two-week high and U.S. equity futures fell, as Trump

also renewed tariff threats on trade partners.

"All of this, tariffs included, is just another reason the

U.S. can't be trusted," said Bart Wakabayashi, the Tokyo Branch

Manager of State Street. "There's no credibility. That's the

basis of the U.S. being the safest investment in the world. If

you're a responsible investor, it gives you pause."

The dollar dropped 0.3% to 147.32 yen. The euro

was up 0.2% on the day at $1.1637.

The dollar index, which tracks the greenback against

a basket of currencies, retreated 0.2% after a 0.7% gain on

Monday.

The yield on the benchmark U.S. 10-year Treasury note

rose 1.8 basis points to 4.293%. The yield on the

30-year bond rose 3.2 basis points to 4.921%.

The two-year U.S. Treasury yield, which

typically moves in step with interest rate expectations for the

Fed, fell 3 basis points to 3.7%.

Trump has regularly threatened to dismiss Fed Chair Jerome

Powell, and earlier this month he fired a top Labor Department

official after accusing her, without evidence, of manipulating

jobs data that had disappointed him.

"I have determined that there is sufficient cause to remove

you from your position," the president said in a letter to Cook

posted on his Truth Social platform, claiming there was enough

evidence that Cook had made false statements on mortgage

applications.

Trump, who lacks the legal authority to fire the Fed chair

except "for cause", has backed away from that threat as Powell

gets closer to the expiration of his term as Fed chief next May.

Cook's exit from the central bank could speed up the

president's reshaping of the Fed and the rate-setting Federal

Open Market Committee (FOMC). Her term had been due to end in

2038.

"The move is another example of concerns over Fed

independence weighing on the dollar and has implications for the

potential makeup of the FOMC going forward," said OCBC currency

strategist Christopher Wong. "That adds to rate cut prospects

and a softer dollar outlook."

MSCI's broadest index of Asia-Pacific shares outside Japan

was down 0.6%, after U.S. stocks ended the

previous session with mild losses. Japan's Nikkei index

sank 1.1%.

Futures markets pointed to a nervous day ahead for Europe

and the U.S.

Euro Stoxx 50 futures were down 0.57%, German DAX

futures were down 0.42% and FTSE futures fell

0.35%. The U.S. S&P 500 e-minis slid 0.17%.

Major brokerages, including Barclays ( BCS ), BNP Paribas and

Deutsche Bank, now expect a 25-basis-point Fed rate cut in

September. Fed funds futures traders are pricing in 83% odds of

a September cut, according to the CME Group's FedWatch Tool.

Data for August due before the Fed's September 16-17 meeting

could still sway policy. The U.S. personal consumption prices

reading, due on Friday, is considered the Fed's preferred

inflation gauge. Hotter-than-expected U.S. producer price data

last month raised some questions over the certainty of a cut.

Extending months of turmoil over on-again, off-again tariff

policies, Trump also threatened "subsequent additional" import

duties on countries with digital taxes.

U.S. crude dipped 0.5% to $64.47 a barrel. Gold rose

0.2% to $3,372.29 per ounce after touching $3,386.27, the

highest since August 11.