Trump Unlikely to Fire Fed Chair Powell Amid Market Volatility

The markets experienced significant volatility following reports that President Donald Trump was considering firing Federal Reserve Chair Jerome Powell, a move that would be unprecedented. Initial news triggered a selloff in the US dollar, a drop in Treasury yields, and a steepening yield curve, reflecting investor concerns about the Fed's independence and future monetary policy. President Trump later denied plans to remove Powell, calming markets somewhat, though uncertainty remains. Trump's persistent calls for aggressive rate cuts and criticisms of Powell have fueled speculation about political interference in monetary policy. Despite the volatility, strong US economic data and earnings helped buoy risk appetite, with the S&P 500 approaching record highs. Overall, the episode underscores the fragile balance between political pressures and market expectations around Federal Reserve leadership and policy direction.