U.S. stock markets plunged on April 21 after President Donald Trump launched fresh criticism at Federal Reserve Chair Jerome Powell, reigniting investor concerns over monetary policy and economic stability. The S&P 500 closed down 2.4%, the Nasdaq shed 2.5%, and the Dow Jones Industrial Average dropped nearly 1,000 points — a 2.5% dip, according to Google Finance.
The broader picture remains grim: the S&P 500 is down over 12% year-to-date, and the Nasdaq has nosedived nearly 18% amid a sweeping sell-off in tech stocks.
The sell-off was triggered by escalating tensions between Trump and Powell, as well as rising anxiety about the effects of lingering trade tariffs.
Trump Demands Rate Cuts, Slams Powell Over “No Inflation” Claims
Taking to Truth Social on April 21, Trump reiterated his call for aggressive interest rate cuts, stating that with energy and food prices trending lower, inflation is essentially non-existent.
“‘Preemptive Cuts’ in Interest Rates are being called for by many,” Trump posted. He further lambasted Powell, labeling him “Mr. Too Late” and a “major loser,” while slamming the Fed’s current rate of 4.5%.
Tensions worsened after Powell cautioned that Trump’s trade policies could usher in “stagflation” — a toxic mix of rising prices and slowing growth. Trump retaliated with a call to fire Powell, stating, “His termination cannot come fast enough.”
Dollar Hits 3-Year Low as Rate Cut Bets Stay Muted
The market, however, isn’t buying into Trump’s rate-cut demands just yet. Fed fund futures show only a 13% chance of a cut at the upcoming May 7 meeting, according to CME Fed Watch.
Meanwhile, the U.S. Dollar Index (DXY) slumped to a three-year low below 98 on April 21, down more than 10% this year. Real Vision CEO Raoul Pal weighed in on April 22, suggesting the weaker dollar is welcomed globally. “Everyone needs and wants a weaker dollar to service their dollar debts,” Pal noted, adding that dollar liquidity is now the biggest driver of global money supply.
Crypto Markets Stay Strong as Bitcoin Hits $88.5K
While traditional markets flounder, crypto markets have remained steady. The total digital asset market cap stood firm at $2.83 trillion as of April 22, bolstered by a Bitcoin rally that pushed the top cryptocurrency to a four-week high of $88,500.
“Amid one of the most turbulent periods for global markets in years, Bitcoin is showing impressive resilience,” analysts at Bitfinex said in a market update.
Despite macroeconomic headwinds and political drama in Washington, crypto continues to position itself as a counterweight to traditional financial instability.
