Global markets recoiled after former U.S. President Donald Trump suggested firing Federal Reserve Chair Jerome Powell, triggering immediate volatility across currencies, Treasuries, and equities.
The dollar fell 1.2% against peer currencies within minutes of reports that Trump queried lawmakers about dismissing Powell a move deVere Group CEO Nigel Green called “a live scenario, not a rumor.” Though Trump later walked back imminent action, investor confidence in Fed independence sustained damage.
“The president asking the question rattled markets,” stated Green, emphasizing that the episode signals a dangerous shift: Central bank autonomy long a bedrock of U.S. institutional trust is now seen as negotiable.
“Markets are pricing in the possibility that future Fed decisions could follow political preference, not policy discipline,” he warned. This perception risks eroding the dollar’s credibility and global capital flows tied to Fed stability.
Volatility spikes underscored how institutional fragility amplifies market sensitivity. Green noted Powell’s authority may be permanently compromised even if he retains his role: “A Fed Chair publicly targeted by the White House injects doubt into every decision.”
The deVere CEO stressed repercussions extend beyond U.S. borders, as international investors view Fed independence as a pillar of financial system integrity.
“Trust built over decades can weaken in a day,” Green concluded. “If investors doubt the Fed acts without fear or favor, consequences will be swift and far-reaching.”
