Trump's Fed Criticism Sends Dollar Tumbling, Fuels Market Fears

The value of the U.S. dollar experienced a significant decline on Monday, reaching its lowest point in three years. This drop followed a renewed attack by Donald Trump on the Federal Reserve chair.

In a social media post, the former president asserted that the U.S. economy would face a slowdown unless Jerome Powell, whom he labeled a "major loser," immediately lowered interest rates. Trump has previously advocated for lower rates and suggested Powell's removal.

The ICE U.S. Dollar Index, which tracks the dollar's performance against a basket of other currencies, closed at 97.92 on Monday. This marks the lowest level for the index since March 2022. The dollar has been on a downward trend since Trump's inauguration, seemingly influenced by his threats of extensive tariffs.

Global markets reacted negatively to Trump's latest criticism of the Federal Reserve. The Dow Jones Industrial Average fell by 1,221 points, a 3.1 percent decrease. The S&P 500 dropped 3.3 percent, and the Nasdaq Composite lost 3.6 percent. Technology companies contributed to the decline, with Tesla and Nvidia stocks falling significantly.

Trump's social media post also included commentary on inflation and interest rates. He argued that with declining energy and food costs, inflation was minimal and that a slowing economy could be averted if interest rates were lowered. He also criticized Powell's past actions, claiming they were politically motivated.

The president's recent comments come as investors continue to assess the potential consequences of his tariff proposals. Since the announcement of these levies, major market indexes have experienced substantial losses.

Concerns about the impact of Trump's tariff plans on major U.S. retailers are growing. Reports indicate that he planned to meet with executives from several prominent companies. The proposed tariffs on Chinese goods have raised concerns about inflation, economic slowdown, and the possibility of a recession.