Investors were greeted with more market turmoil Monday as President Donald Trump’s trade war and escalated attacks on Fed Chair Jerome Powell spooked investors even further, according to Vanessa Yurkevich, CNN’s business and politics correspondent.
And the situation has the potential to sink even lower, she warned.
“There's two story lines playing out right now that investors and traders are sort of trying to grapple with,” Yurkevich said Monday. “And story lines they don't think are going away anytime soon.”
The CNN analyst told viewers that despite tariff negotiations over the weekend between Japan and the United States, “investors and traders aren't seeing any tangible deals being made.”
“And that's concerning for them, because they see Japan as an ally, as a key trading partner, and I have an analyst that I spoke to a little bit earlier who said that if Japan and the U.S. can't come to a deal, what does that mean for the dozens of other countries that are supposed to be negotiating with the United States around this trade war?” according to Yurkevich.
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She added that investor fears were further fueled by Trump’s fresh attack on Powell, who the MAGA leader blasted in a Truth Social post on Monday as “Mr. Too Late” and “a major loser” over his resistance to lower interest rates.
“But the Federal Reserve is an independent institution; it was set up that way on purpose, and so now you have traders and investors worried that the president is trying to meddle into monetary policy,” Yurkevich told viewers.
She added that the two evolving storylines “have investors and traders pricing in sort of the worst case scenario in markets right now.” And that includes preparing for a situation where Trump attempts to wield his power to remove Powell, which the CNN analyst said would be “really, really tricky to do.”
“It's never been done before,” she said. “And if you look at the picture that's playing out on Wall Street right now, to remove the chair of the Federal Reserve would only make what we're seeing today a lot worse.”
Watch the video below via CNN or at the link here.