Fed's Independence Under Siege: Trump vs. Powell Escalates in 2026

The clash between U.S. President Trump and Fed Chair Jerome Powell heightens as Trump threatens a criminal indictment against Powell over Fed independence. This has led to market volatility, with the dollar dropping and gold prices hitting record highs amid geopolitical tensions and economic uncertainties in 2026.

The ongoing conflict between President Trump and Federal Reserve Chair Jerome Powell has intensified, with Trump threatening a criminal indictment against Powell. This move raises concerns about the Fed's independence from political influence, contributing to volatility in global financial markets and sparking a sharp decline in Wall Street futures and the U.S. dollar.

Investor confidence has been rattled, driving safe-haven assets like gold to record highs. Analysts attribute these market fluctuations to Trump's actions, which have exacerbated geopolitical uncertainties and pressured the Federal Reserve to consider more aggressive rate cuts amid rising tensions in Iran and economic challenges.

The dollar's decline, coupled with Powell's defense of the Fed's autonomy, marks a significant moment in the ongoing struggle between U.S. economic policy leadership and political intervention, influencing perceptions of American financial stability and global economic dynamics.

(With inputs from agencies.)