Trump’s attacks on U.S. Fed chair spark big drops on Wall Street

Trump's comments drove the stock market and the U.S. dollar lower as investors in the U.S. and overseas grow increasingly wary about the economic standing of the U.S.

U.S. President Donald Trump repeated his attacks Monday against the chair of the Federal Reserve, demanding that the independent central bank lower its key interest rate to boost the economy.

Stock markets in the U.S. and Canada dropped as a result, as investors worldwide get more skeptical about U.S. investments amid Trump’s rhetoric against U.S. Federal Reserve Chair Jerome Powell and the growing global trade war due to Trump’s tariffs.

The S&P 500 sank 2.4% in another wipeout. That yanked the index that’s at the center of many Americans’ retirement accounts 16% below its record set two months ago.

The Dow Jones Industrial Average dropped 971 points, or 2.5%, while losses for Tesla and Nvidia helped drag the Nasdaq composite down 2.6%.

In Canada, the S&P/TSX composite index closed down more than 180 points.

Perhaps more worryingly, U.S. government bonds and the value of the U.S. dollar also sank — the latter to a three-year low — as prices retreated across U.S. markets.

Trump on Monday called Jerome Powell “a major loser” and said that energy and grocery prices are “substantially lower” and “there is virtually No Inflation.” Yet Trump said the economy could slow without rate cuts.

Gas prices have fallen for the past two months, in part because oil costs have dropped on fears of slower growth, but food prices jumped in January and March and overall inflation remains above the Fed’s 2% target.