Bloomberg News also reported that the Trump administration is preparing to nominate Warsh as the next Fed chair. Warsh "is on record as saying he prefers lower rates," said Damien Boey, portfolio strategist, Wilson Asset Management in Sydney "But the trade-off that he makes with lower rates is that he wants the Fed to have a smaller ⁠balance sheet," he added. "The markets are reacting as ​if thinking: 'What would the world look like with a smaller Fed balance sheet?' The U.S. dollar index, which measures the greenback's strength against a basket of six currencies, was last up 0.3% at 96.481, reversing some recent weakness. Asian stocks were led lower by declines in China, with a gauge of Chinese companies with listings in Hong Kong off 2.1%.