Market Turmoil as Trump's Fed Attacks Shake Investor Confidence

Wall Street indexes fell after Trump's criticism of Fed Chair Powell raised independence concerns. Trump's remarks about Powell stoked fears, affecting investor confidence amid trade tensions. Key indices and the dollar fell as markets reacted to potential policy changes and uncertainty regarding tariffs and trade deals.

Wall Street's principal indexes plummeted to over one-week lows on Monday, following U.S. President Donald Trump's renewed criticisms of Federal Reserve Chair Jerome Powell. The attacks intensified worries over the central bank's autonomy, unsettling market confidence.

During a Truth Social post, Trump insisted that the economy risks deceleration unless interest rates are slashed immediately. This followed White House economic aide Kevin Hassett's comments suggesting that firing Powell could be considered. Investor confidence in U.S. assets, already impacted by trade tariffs, further waned due to doubts about the central bank's independent policy-making abilities.

The S&P 500, Nasdaq Composite, and Dow Jones Industrial index each reported notable declines amid holiday-thinned trading. Concurrently, the U.S. dollar index decreased, even as the yield on the 10-year Treasury note jumped.

(With inputs from agencies.)