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Stocks took another dive at the start of the week, and this time they weren’t reacting to Donald Trump’s tariff volleys. It was the US president’s musings about firing Fed Chair Jerome Powell for not lowering interest rates that sent investors running for cover. But just days after ramping up his trademark name-calling — sentiments such as Powell being “Mr. too late” and a “major loser” — Trump retreated. The Republican announced yesterday that he has no intention of firing Powell (though it’s an open question as to whether he can do so legally). Still, Trump wants the central bank to cut rates and is unlikely to stop agitating on that front, especially as the US economy weakens on his watch.
On this week’s episode of Trumponomics, we speak with Krishna Guha, vice chairman of Evercore ISI and head of its Global Policy and Central Bank Strategy Team, about the implications Trump’s attacks on Powell (whom he nominated during his first term) have for markets and the wider global economy. He breaks down how investors have been reacting to Trump’s latest comments and the growing concerns around confidence in US assets.
