Dollar tumbles as Trump’s Fed pressure stokes investor jitters

The US dollar tumbled on Monday as investor concerns mounted over the Federal Reserve’s independence, following fresh comments from President Donald Trump suggesting he may attempt to remove Fed Chair Jerome Powell.

The greenback fell sharply across global currency markets, hitting a 10-year low against the Swiss franc and sliding to a seven-month low versus the yen.

The euro surged to its highest level in three years, while emerging market currencies also gained ground.

The market reaction followed remarks from White House economic adviser Kevin Hassett, who confirmed the administration is still studying the possibility of firing Powell.

Trump, who has repeatedly criticized the Fed for not cutting interest rates, said last week that Powell’s termination "cannot come fast enough."

While legal experts say the president lacks direct authority to fire the Fed chair, analysts say political pressure alone could damage the central bank’s credibility.

“You just need to create the perception that you could fundamentally change the view of an independent Fed,” said Vishnu Varathan, head of macro research at Mizuho in Singapore.

Against a basket of major currencies, the dollar fell to a three-year low of 98.267. The yen strengthened to 140.63, while the euro hit $1.1533. Sterling rose above $1.3380, and the Australian and New Zealand dollars touched multi-month highs.

Investors have also grown wary of Trump’s unpredictable trade policies, which have triggered market volatility and weighed on US economic sentiment.

Equities softened globally, with S&P 500 futures down 0.6% and Japan’s Nikkei falling over 1%. Meanwhile, gold surged above $3,370 per ounce on safe-haven demand, and Brent crude fell 1.75% to $66.77 amid easing tensions with Iran.

Markets will closely watch upcoming earnings from major U.S. firms and further signals on Fed policy amid ongoing political scrutiny.