In a fierce escalation of his ongoing feud with the Federal Reserve, President Donald Trump launched a barrage of criticisms against Fed Chair Jerome Powell on Monday, ramping up calls for lower interest rates to invigorate the faltering U.S. economy.

Labeling Powell a 'major loser', Trump insisted that despite claims of low inflation and falling gas prices, significant risks loom if monetary policy remains unchanged. He argued that the economy could experience a downturn without urgent rate cuts.

While it's true that gas prices have seen a decline in recent weeks due to slumping oil prices, food costs surged earlier in the year, and inflation remains above the Fed’s target of 2%. This contradiction adds complexity to Trump's push for drastic measures.

Trump’s incendiary remarks not only rattled the stock market but also drove the dollar down as investors worldwide expressed deepening concern over America's economic stability. Following Trump’s tweet, which analysts deemed reckless, the S&P 500 index plummeted by 2% during morning trading, adding to fears of a broader market collapse.

The tension escalated when a senior White House adviser hinted that the administration was exploring options to potentially oust Powell, a controversial move that would jeopardize the Fed’s independence and could trigger chaos in global financial markets.

As the dollar dipped—an unusual occurrence during stock market downturns—interest rates for 10-year Treasuries spiked to 4.35%, signaling increased borrowing costs for homebuyers and further straining the housing market.

With the stakes spiraling higher, Trump reiterated on Friday that he could dismiss Powell, though it would likely initiate a legal battle with consequences that could reach the Supreme Court. Powell has maintained that Trump lacks the authority to dismiss him and has vowed to remain in his position until his term concludes in May 2026.

As the economic landscape grows increasingly precarious, all eyes remain on how this power struggle affects the financial future of the nation.