U.S. financial markets suffered significant losses on April 21, 2025, following President Donald Trump’s renewed criticism of Federal Reserve Chair Jerome Powell. Trump labeled Powell a “major loser” for not implementing interest rate cuts, raising concerns about potential political interference in the Federal Reserve’s operations.
Market Reaction
All three major U.S. stock indices—Dow Jones, S&P 500, and Nasdaq—declined by over 2%, with the Nasdaq experiencing notable losses in major technology stocks. The U.S. dollar fell sharply, while gold prices surged to a new record above $3,400, indicating a shift towards safe-haven assets.
Concerns Over Fed Independence
Analysts expressed alarm over the potential erosion of the Federal Reserve’s independence. Chicago Federal Reserve President Austan Goolsbee warned that political pressure on the Fed could lead to adverse economic outcomes, including higher inflation and increased unemployment.
Global Market Implications
The market’s response suggests growing unease among investors regarding U.S. economic stability and governance. As global markets continue to react to U.S. policies, the situation underscores the importance of maintaining institutional independence to ensure investor confidence and economic stability.
President Trump and Fed Chairman Powell Picture from tagesschau.de
