US stocks sharply declined after President Trump renewed his attacks on Federal Reserve Chair Jerome Powell, leading to worries about the Fed's independence and its inflation control capabilities. Trump's comments follow a previous call for interest rates to be cut to stimulate the economy. Following these criticisms, significant stock losses were recorded, particularly in tech stocks, with Wall Street reacting negatively to ongoing trade uncertainties and a lack of progress in negotiations. Analysts noted that investor confidence was shaken by the potential for political interference within the Fed.
"Investors are worried about Fed independence," Jack Ablin, chief investment officer at Chicago-based Cresset Capital told the Reuters news agency. "If the president puts his own person in and lowers rates against a backdrop of rising inflation, we'll see a continuation of what we're experiencing now."
"Markets are showing disapproval of a lack of progress on trade negotiations," commented Jamie Cox, managing partner at Harris Financial Group in Richmond, Virginia. "In the absence of any firm commitments from any countries, markets take the 'fire first, ask questions later' approach."
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