The Dow plunged more than 950 points Monday as President Trump intensified his attacks on the Federal Reserve’s independence — calling chairman Jerome Powell “a major loser” for not lowering interest rates.
The Dow Jones Industrial Average slid 971.82 points, or 2.5%, to 38,170.41 after losing 1,406 points during the previous holiday-shortened week. US markets were closed on Friday in observance of Good Friday.
The S&P 500 and the Nasdaq also slipped more than 2%.
“Clearly, the market does not like the certainty of uncertainty, and it’s reflected in the daily volatility and declining markets,” Ted Jenkin, president of Exit Stage Left Advisors, told The Post.
“Until this volatility settles, we will continue to see choppy financial days on the markets.”
In a fiery Truth Social rant on Monday, Trump once again called for the Federal Reserve to slash interest rates immediately, taunting Powell with the nickname “Mr. Too Late.”
“‘Preemptive Cuts’ in Interest Rates are being called for by many. With Energy Costs way down, food prices (including Biden’s egg disaster!) substantially lower, and most other ‘things’ trending down, there is virtually No Inflation,” Trump wrote.
According to the most recent data, consumer prices rose 2.4% over the past 12 months through March.
Last month, egg prices at supermarkets hit a record high despite fewer bird flu cases and falling wholesale costs — indicating retailers could be holding out on passing along the lower prices.
“With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW…” Trump continued.
“Powell has always been ‘To Late,’ except when it came to the Election period when he lowered in order to help Sleepy Joe Biden, later Kamala, get elected.”
If the Fed were to cut rates now, it might appear to be caving to Trump’s political agenda, according to Kenneth Mahoney, chief executive of Mahoney Asset Management.
It “puts them between a rock and a hard place,” Mahoney told The Post. “Even if they think cutting at some point is the right move, it will seem like they are appeasing Trump and bending to his will.”
Questions intensified over the weekend around the Federal Reserve’s independence after National Economic Council Director Kevin Hassett on Friday said Trump is studying whether he’s able to fire Fed Chair Jerome Powell.
Last week, Trump wrote in a Truth Social post, “Powell’s termination cannot come fast enough.”
That dig followed a warning from the nation’s top central banker that sweeping tariffs could keep inflation higher for longer and that he is in no hurry to cut rates.
On Wednesday, Powell had cautioned that Trump’s new wave of trade taxes are “significantly larger than anticipated,” adding that “the same is likely to be true of the economic effects, which will include higher inflation and slower growth.”
“Avoiding that outcome will depend on the size of the effects, on how long it takes for them to pass through fully to prices, and, ultimately, on keeping longer-term inflation expectations well anchored,” he continued.
Markets suffered steep losses and particularly volatile trading sessions over the past three weeks as Trump’s stiff tariffs — including a 145% rate on China — spooked investors, who worried the taxes could reheat inflation and even cause a recession.
Last month, egg prices at supermarkets hit a record high despite fewer bird flu cases and falling wholesale costs — indicating retailers could be holding out on passing along the lower prices.
On Thursday, the Dow and Nasdaq recorded their third losing session in a row — finishing the week with more than a 2% drop each over four days. The S&P 500 ended Thursday higher, but closed out the week down 1.5%.
On April 2, his so-called “Liberation Day,” Trump unveiled sweeping levies, including hefty rates on many essential trading partners. He has since paused those rates for 90 days, lowering them to a 10% across-the-board tax.
Investors are hoping the US will be able to reach meaningful negotiations with foreign nations, and soon — as global trade tensions could stir supply chain crises and price hikes across several industries.
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