The Fed declined to comment on Monday’s latest rhetorical attacks. Powell has said flatly the president doesn’t have the legal authority to dismiss him.
- While some top Trump advisers have previously said the administration will respect the Fed’s independence around monetary policy, Kevin Hassett, the director of the White House National Economic Council, on Friday said Trump is studying whether he’s able to fire the Fed chief.
- On Monday, the S&P 500 index tumbled roughly 1.9 percent in the first hour of trading, bringing it more than 15 percent below its late-February peak.
- The more narrow Dow Jones Industrial Average slipped 1.8 percent, or about 750 points. Meanwhile, the tech-heavy Nasdaq composite index fell 2.4 percent Monday as all of the “Magnificent 7” group of big tech companies suffered losses.
The dollar also lost value Monday in comparison to foreign currencies, with the DXY U.S. dollar index down about 1 percent by mid-morning.
President Donald Trump renewed his attacks on Federal Reserve Chair Jerome H. Powell on Monday, a move that exacerbated a stock sell off amid persistent uncertainty about the administration’s approach to trade and the economy.
Trump, taking to his social media platform Truth Social, referred to Powell as a “major loser” and said the U.S. economy could slow without an immediate reduction in the cost of money amid the fallout from his trade war.
“‘Preemptive Cuts’ in Interest Rates are being called for by many,” the president said. “Powell has always been ‘To [sic] Late.”
Trump referenced March inflation data, gathered before this month’s tariffs went into effect, to claim there is “virtually No Inflation.” A key gauge of inflation — the consumer price index — showed prices rose by 2.4 percent in March from a year earlier, which showed progress but was still higher than the Fed’s preferable 2 percent.
“With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW,” Trump wrote.
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