Stocks and Dollar Plummet as Trump Unleashes New Attacks on Fed Chair Powell

US stocks experienced a significant decline on Monday as President Donald Trump intensified his public criticism of Federal Reserve Chair Jerome Powell, labeling him "a major loser" for failing to lower interest rates. Trump urged Powell to take immediate action to cut rates "pre-emptively" to stimulate the economy, claiming that Powell's delayed responses to economic changes could lead to a slowdown. This latest barrage of criticism comes in tandem with Trump's own tariff strategies that have resulted in market unease and recession fears.In early trading on Monday, the S&P 500 index fell around 3%, erasing nearly 12% of its value year-to-date. The Dow Jones Industrial Average registered a 2.9% decrease, down about 10% since January, while the Nasdaq composite dropped more than 3.4%, reflecting an 18% decline in 2023. The dollar, which is generally deemed a safe-haven asset during market volatility, also took a hit, dropping to its lowest level since 2022, as measured by the dollar index against other currencies including the Euro. Concurrently, US government bond interest rates increased as investors sought higher returns.Trump's ongoing disapproval of Powell dates back to his earlier presidency, where discussions about Powell's potential firing surfaced. Last week, he reiterated his demand for Powell's removal, declaring on social media that "Powell's termination cannot come fast enough." This proposition raises legal doubts given the Fed's tradition of independence, although a Trump economic adviser recently confirmed that the administration is reviewing the possibility.Powell, in response to Trump's tariffs, had previously warned that the measures could lead to increased prices and hinder economic growth, further complicating the relationship between the President and the central bank.