Markets Rally as Trump Backs Off Powell Threat, Reassures Global Investors

Markets Rally as Trump Backs Off Powell Threat, Reassures Global Investors

Washington, April 22, 2025 — Global stock markets rebounded sharply after U.S. President Donald Trump walked back his earlier threat to remove Federal Reserve Chair Jerome Powell, stating he has “no intention” of firing him — a move seen by investors as a crucial step in restoring confidence amid ongoing economic uncertainty.

Trump’s remarks helped ease tensions after a week of market volatility, which was triggered by his recent verbal attacks on Powell over inflation and interest rate policy. The reversal signals a more tempered tone from the White House at a time when investor sentiment is fragile due to rising trade tensions and unclear monetary policy direction.

U.S. Futures Surge on Reassurance
Markets responded swiftly to Trump’s comments:
- Dow Jones Futures surged over 500 points (+1.3%)
- S&P 500 Futures climbed +1.6%
- Nasdaq Futures jumped +1.8%

The rebound was further supported by comments from Treasury Secretary Scott Bessent, who hinted that the U.S. may be open to “easing its stance” in the ongoing trade conflict with China. Bessent acknowledged that the current tariff levels — 145% on Chinese goods and 125% on U.S. exports — are “unsustainable” in the long term.

“I’m hopeful that we’ll see some de-escalation in the coming months,” Bessent said, though he cautioned that any major trade agreement will take time to finalize.

Trump–Powell Relationship Remains Fragile
Despite Trump being the one who originally appointed Powell during his first term, their relationship has grown increasingly tense, particularly after Trump’s re-election. Powell has repeatedly affirmed that he would not resign even if directly requested by the President — a stance widely seen as a defense of the Fed’s independence.

Outlook:
Trump’s rhetorical retreat appears to reflect mounting pressure from financial markets, which remain sensitive to any signs of political interference in monetary policy. With interest rate direction still uncertain and global trade tensions unresolved, investors are likely to stay highly alert to signals from both the Fed and the White House in the coming weeks.