Trump Hits a Nerve in America! Dollar Index Plummets to Three-Year Low!

TradingKey - President Trump threatens to fire Fed Chair Powell. The dollar crashes, hitting a three-year low. It may continue to face downward pressure.

On Monday, during the Asian trading session, the dollar index dropped over 1% due to Trump's threat to dismiss Powell. It hit a low of 98.16, the lowest level in three years. The next support for the dollar index is at 90.

Dollar Index Trend Chart, Source: TradingView

Last week, Trump warned he could remove Powell. He told reporters, "If I let him go, he'll be gone quickly, believe me." This action is putting pressure on the dollar.

French economist Eric Lombard warned that if Trump fires Powell, the dollar's credibility will be at risk. The U.S. economy could enter a stagnation phase. Goldman Sachs analysts stated that if the Fed loses its independence, the market will face drastic changes.

However, in Louisiana celebrations, Senate Banking Committee member John Kennedy believes Trump does not have the power to fire Powell. Kennedy stated on NBC, "I don’t think the president, any president, has the right to dismiss the Fed chair."