Financial markets in the United States suffered a sharp downturn on Monday after President Donald Trump launched a fresh tirade against Federal Reserve chair Jerome Powell, labelling him “a major loser” for refusing to slash interest rates.
In a post on social media, Trump accused Powell—whom he appointed during his first term—of being too slow to respond to economic signals, urging him to lower rates “pre-emptively” to avert a possible slowdown.
“There can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW,” the president wrote.
The remarks added to growing volatility in global markets, already unsettled by Trump’s aggressive trade policies and threats of new tariffs, which economists say risk tipping the US into recession.
On Wall Street, the S&P 500 fell by approximately 2.4%, bringing its year-to-date losses to around 12%. The Dow Jones Industrial Average dropped by 2.5%, while the tech-heavy Nasdaq slumped more than 2.5%, down about 18% since January.
The sell-off also hit the dollar, which dropped to its lowest level since 2022, as measured by the dollar index against a basket of major currencies. Meanwhile, yields on US government bonds rose as investors demanded higher returns for holding Treasury securities.
Despite traditionally being seen as safe-haven assets during economic unrest, both the dollar and Treasuries failed to provide shelter from the current turbulence.
Gold, by contrast, surged to a record high, breaking past $3,400 (£2,563) per ounce for the first time as anxious investors flocked to the precious metal.
The fallout was felt across Asian markets on Tuesday afternoon. Japan’s Nikkei 225 and Australia’s ASX 200 both dipped by 0.1%, while Hong Kong’s Hang Seng Index edged 0.2% higher in light trading.
Trump’s attacks on Powell have intensified in recent weeks, with the president repeatedly accusing the central bank chief of undermining economic growth. Last week, he publicly called for Powell’s removal, declaring: “Powell’s termination cannot come fast enough.”
Although Powell has insisted the president lacks legal authority to dismiss him, one of Trump’s senior economic advisers said on Friday that the White House was exploring the option. That statement came as US financial markets were closed for a public holiday.
The central bank’s independence has long been considered a cornerstone of the US financial system, and any attempt to remove the Fed chair would be seen as a deeply controversial move likely to provoke political and legal challenges.
Powell has previously warned that Trump’s tariff policies could stoke inflation and hamper economic growth—comments that appear to have fuelled the president’s latest round of criticism.
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