Global Markets React to Tariff Concerns and Fed Criticism

Singapore: Asian stocks and U.S. equity futures experienced a downturn on Monday, while the dollar weakened. This occurred amid growing apprehension regarding tariffs and President Trump’s open disapproval of the Federal Reserve, which negatively impacted market sentiment and propelled gold prices to unprecedented levels.

President Trump initiated a sequence of criticisms directed at Fed Chairman Jerome Powell on Thursday, with his administration exploring potential avenues for Powell’s dismissal—an action carrying substantial ramifications for the independence of the central bank and the stability of global markets.

Many markets were shut down last Friday, and some are still closed for the Easter Monday holiday.

S&P 500 futures saw a decrease of 0.64%, and Nasdaq futures declined by 0.53%. In Asian markets, Japan’s Nikkei index fell by 1%, whereas South Korea’s primary index remained stable.

Charu Chanana, chief investment strategist at Saxo in Singapore, noted, “Markets are already tense due to rising geopolitical uncertainties, and there are increasing concerns that Trump’s possible interference with the Fed could introduce further unpredictability.”

“Any indication of political influence over monetary policy might compromise the Fed’s autonomy and complicate the future trajectory of interest rates, particularly as investors seek stability amidst worldwide instability.”

Trump’s tariffs have caused disruption in financial markets and led to a significant sell-off in U.S. Treasury bonds and the dollar, which has raised new doubts about the perceived safe-haven status of U.S. assets.

This diminished confidence in U.S. assets has been intensified by Trump’s criticisms of the Fed, causing the dollar to depreciate against most other currencies.

The euro reached a three-year peak, while the yen attained a seven-month high.

The Swiss franc increased by 0.6% against the dollar and was trading near its 10-year high reached earlier in the month.

Statements from the Federal Reserve

Austan Goolsbee, President of the Chicago Federal Reserve, expressed his hope on Sunday that the U.S. is not progressing towards a situation where the central bank’s ability to independently determine monetary policy, without political influence, is questioned.

The yield on the benchmark U.S. 10-year Treasury note increased by 3 basis points to 4.358% during early trading hours in Asia.

With the U.S. earnings season commencing, investors will be closely monitoring the results from tech giant Alphabet, chip manufacturer Intel, and electric vehicle producer Tesla this week.

All of the “Magnificent Seven” megacap stocks are significantly lower in 2025, with Alphabet decreasing by approximately 20% and Tesla declining by 40%.

Companies and investors are dealing with an evolving tariff environment as the Trump administration engages in negotiations with various nations.

Although Trump has temporarily suspended some of the most substantial levies on imports, the U.S. is also involved in a trade dispute with China, the world’s second-largest economy.

Trump commented on Friday that the U.S. is engaged in constructive private discussions with China amidst the ongoing trade conflict between the two countries. However, China’s ambassador to the United States has indicated that the U.S. should demonstrate respect before any discussions can occur.

Commodities Market Update

In commodities, gold prices jumped by more than 1%, reaching a record high of $3,370.17 per ounce, bringing its year-to-date gains to 26%. The surge underlines the precious metal’s appeal as a safe haven asset.

Gold has consistently marked record highs this year, fueled by safe-haven demand.