US stocks and the dollar plunged again as President Donald Trump intensified his attacks on US central bank boss calling him "a major loser" for not lowering interest rates. In a social media post, Trump called on Federal Reserve chair Jerome Powell to cut interest rates "pre-emptively" to help boost the economy, saying Powell had been consistently too slow to respond to economic developments. "There can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW," he wrote. Trump's criticism of Powell's handling of the US economy comes as his own plans for tariffs have driven a stock market sell-off and raised fears of economic recession. The president's intensifying clash with Powell, whom he named to lead the Fed during his first term, has added to the market turmoil. The S&P 500, which tracks 500 of the biggest US companies, was down roughly 3% in early afternoon trading on Monday. It has lost roughly 12% of its value since the start of the year. The Dow Jones Industrial Average dropped 2.9% and has dropped about 10% so far this year, while the Nasdaq fell more than 3.4% and is down roughly 18% since January. Though the dollar and US government bonds are typically considered safe assets in times of market turmoil, they have not escaped the recent turbulence. The dollar index - which measures the strength of the dollar against a set of currencies including the Euro - on Monday fell to its lowest level since 2022. Interest rates on US government debt also rose, as investors demanded higher returns for holding Treasuries. Trump's criticism of Powell dates back to his first term in office, when he also reportedly discussed firing him. Since winning the election, he has urged Powell to lower borrowing costs. The latest criticism follows Powell's warnings that Trump's import taxes were likely to drive up prices and slow the economy. Trumplast week called publicly for Powell to be fired, writing on social media on Thursday: "Powell's termination cannot come fast enough,". Such a move would be controversial - and legally questionable - given a tradition of independence at the bank. Powelllast year told reportershe did not believe the president had the legal authority to remove him. But one of Trump's top economic advisers confirmed that officials were studying the option on Friday, when the stock market in the US was closed for trading.
US stocks and dollar plunge as Trump attacks Fed chair Powell
TruthLens AI Suggested Headline:
"US Stocks and Dollar Decline Amid Trump's Criticism of Fed Chair Powell"
Bbc News
6.0
TruthLens AI Summary
US stocks and the dollar experienced significant declines as President Donald Trump escalated his criticism of Federal Reserve Chair Jerome Powell, labeling him 'a major loser' for his reluctance to lower interest rates. In a series of social media posts, Trump urged Powell to take preemptive action to cut interest rates in order to stimulate the economy, arguing that Powell has been slow to react to economic changes. This criticism comes amid a broader backdrop of market instability, exacerbated by Trump's tariff strategies, which have contributed to a notable stock market sell-off and increased concerns about a potential economic recession. The S&P 500 index, which represents a broad cross-section of the U.S. economy, fell approximately 3% during early afternoon trading on Monday, marking a 12% decline since the beginning of the year. Other major indices, including the Dow Jones Industrial Average and the Nasdaq, also suffered substantial losses, with declines of about 10% and 18%, respectively, since January.
In addition to the stock market's downturn, the dollar and U.S. government bonds, typically viewed as safe havens during turbulent times, have not been immune to the recent volatility. On the same day, the dollar index dropped to its lowest level since 2022, indicating weakened confidence in the currency. Furthermore, interest rates on U.S. government debt increased as investors sought higher returns for holding Treasuries. Trump's ongoing criticism of Powell is not a new development; it dates back to his first term when he considered firing the Fed chair. Following Powell's warnings that the president's import tariffs could lead to increased prices and economic slowdown, Trump publicly called for Powell's termination, intensifying the ongoing tension between the White House and the Federal Reserve. While such a dismissal would be controversial and legally questionable, discussions about this possibility have reportedly taken place among Trump's economic advisers, further complicating the relationship between the administration and the central bank.
TruthLens AI Analysis
The article highlights the significant impact of President Trump's criticisms of Federal Reserve Chair Jerome Powell on the U.S. stock market and the dollar. Trump's derogatory remarks about Powell's performance have coincided with a notable decline in stock indices and the dollar's strength, reflecting broader economic concerns.
Market Reaction to Political Commentary
The stock market's response, characterized by a sharp decline in major indices like the S&P 500, Dow Jones, and Nasdaq, reveals a sensitivity to political commentary. Trump's call for rate cuts seems to be aimed at influencing Powell’s decisions and stimulating economic growth, yet it appears to have backfired, leading to increased market volatility. The dollar's plummet to its lowest level since 2022 further indicates investor unease amidst political uncertainty.
Perception Management
By labeling Powell as "a major loser," Trump seeks to shape public perception of the Fed's role in economic management. This rhetoric may create a narrative that positions Powell as an impediment to economic progress, potentially swaying public opinion against the Fed's current monetary policy. The language used suggests an attempt to rally support for more aggressive monetary easing, appealing to individuals concerned about economic downturns.
Underlying Issues and Concealment
The article does not overtly highlight potential underlying issues, such as the broader implications of Trump's tariffs and their contribution to market instability. By focusing on Powell's actions, there may be an intentional diversion from discussing how trade policies are influencing economic conditions.
Manipulative Elements
The article's framing of Trump's comments can be seen as manipulative. The choice of words, such as "major loser," is intended to provoke emotional responses and draw attention to Trump's grievances rather than fostering a constructive dialogue about economic policies. This approach can polarize public opinion and distract from substantive economic discussions.
Trustworthiness of the Information
The reliability of the information appears solid, as it is based on observable market reactions and direct quotations from Trump. However, the interpretation of events may lean towards sensationalism, particularly in how it frames the conflict between Trump and Powell.
Broader Implications for Society and Economy
The potential fallout from this ongoing conflict could lead to increased volatility in financial markets, affecting investor confidence and economic stability. If Trump’s rhetoric continues to dominate the narrative, it may hinder Powell's ability to implement necessary monetary policies, possibly exacerbating recession fears.
Support Base and Audience Engagement
The article seems to engage audiences who are critical of the Federal Reserve and supportive of Trump's economic agenda, particularly those who prioritize aggressive monetary policies to stimulate growth. It may resonate with both his political base and broader audiences concerned about economic performance.
Impact on Global Markets
The developments discussed in the article could have significant implications for global markets, especially as U.S. economic policy has far-reaching effects. Investors worldwide will be watching closely, particularly regarding sectors sensitive to interest rate changes.
Relevance to Global Power Dynamics
This news piece intersects with current global economic discussions about trade policies and monetary strategies. The tensions between fiscal policy and political commentary reflect broader themes in global governance and economic stability.
In conclusion, while the article presents factual information regarding market movements and Trump’s remarks, it also employs a narrative that could sway public opinion against Powell and the Federal Reserve. The manipulative language used suggests an attempt to influence the conversation surrounding economic policies, making it essential for readers to critically assess the motivations behind such reports.