Market Panic: Trump's Latest Twitter Attack Rocks Wall Street

In a dramatic turn of events, US stocks and the dollar took a nosedive following President Donald Trump's scathing remarks directed at Federal Reserve Chair Jerome Powell. Accusing Powell of being "a major loser," Trump urged for immediate interest rate cuts to stimulate the economy.

The President expressed his frustration on social media, insisting, "There can be a SLOWING of the economy unless Mr. Too Late lowers interest rates, NOW!" This explosive rhetoric coincided with ongoing fears surrounding his tariff plans, which have already led to significant sell-offs in the stock market.

Stock Market Turmoil: Key Indices Dive Deep

The fallout from Trump's comments was palpable on Wall Street. The S&P 500 index, which represents 500 of the largest US companies, plummeted by around 2.4% on Monday, marking a staggering 12% decline since the beginning of the year. Meanwhile, the Dow Jones Industrial Average recorded a drop of 2.5%, and the tech-heavy Nasdaq fell by more than 2.5%, leading to an alarming 18% dip year-to-date.

Dollar Declines Amid Economic Uncertainty

Typically considered safe havens during market turmoil, the dollar and US government bonds were not immune to the recent chaos. The dollar index, which gauges the dollar's strength against a basket of currencies including the Euro, fell to its lowest point since 2022.

In addition, interest rates on US government debt rose as investors sought higher returns for holding Treasuries, reflecting growing concern over economic stability.

The Ongoing Feud: Trump vs. Powell

Trump’s vendetta against Powell isn't new; it dates back to his initial term when firing Powell was reportedly considered. Since taking office, Trump has persistently pressured Powell to lower borrowing costs. This latest tirade follows Powell's warning that Trump's tariffs could exacerbate inflation and hinder growth.

Just last week, Trump amplified his call for Powell to be dismissed, tweeting, "Powell's termination cannot come fast enough." Such a drastic action would stir controversy, potentially breaching the Fed's tradition of independence.

Speculation Grows: Could Powell Be Out?

Despite Powell asserting in the past that the President lacks the legal authority to fire him, one of Trump’s key economic advisors confirmed on Friday that discussions regarding Powell’s future are indeed underway, leaving markets in a state of apprehension as they await further developments.