Explore why Fed independence is crucial for market stability, the impact of tariffs on inflation, and the risks of undermining Federal Reserve credibility. Read what investors need to know.

Analysts have warned of serious financial fallout if Trump follows through. Deutsche Bank strategist George Saravelos said in a Friday note that firing Powell would represent “a direct affront to Fed independence ” and predicted a 3 to 4 percent drop in the dollar within 24 hours.

Markets, as well as the dollar, took a quick dive Wednesday on reports that Trump was talking about terminating Powell, but largely recovered after he appeared to walk back those sentiments. A number of companies witnessed strong performances in the earning session,

Michael Brown of Pepperstone discusses how the markets could potentially react if President Trump attempted to remove Fed chairman Jerome Powell before his term ends next May.

Top voices on Wall Street have expressed alarm over the idea that Trump could fire Fed Chair Jerome Powell, emphasizing the need for Fed independence.

If President Trump gets his way and removes Jerome Powell as chairman of the U.S. Federal Reserve, the market reaction would be swift and brutal, Deutsche Bank’s George Saravelos argues. It could collapse the currency and bond markets,

Potential removal of Fed Chair Jerome Powell could disrupt markets, spike inflation expectations, and impact the USD and bonds.

However, it never looked like markets fully priced in Powell’s exit yesterday afternoon. Pricing for a September Fed cut didn’t go beyond 20bp, and EUR/USD failed to get beyond 1.1720 even before Trump’s denial caused an unwinding of all market moves.

Reports of Trump firing Fed Chair Powell caused major indexes to fall midday Wednesday, but losses were pared as Trump backed off.

President Trump has renewed calls for Federal Reserve Chair Jerome Powell to resign, criticizing the Fed for not cutting interest rates.