 "Trump's Fed criticism rattles markets; US stocks dip, dollar hits 3-yr low")
US stock indexes fell and the dollar index slid to a three-year low on Monday as US President Donald Trump's continued attacks on the Federal Reserve chair and the bank's monetary policy rattled investors.
Safe-haven gold prices hit another record high, while the Swiss franc also rose. Benchmark US Treasury yields edged higher.
Trump on Monday repeated his criticism of Fed Chair Jerome Powell and said the US economy could slow down unless interest rates are lowered immediately.
White House economic adviser Kevin Hassett said on Friday, when many markets were closed, that Trump and his team would study the matter, when asked if firing Powell was an option. Trump had launched a scathing attack against Powell on Thursday.
The comments on Powell fueled worries about the Fed's independence in setting monetary policy path and about the outlook for US assets.
"Trump's comments on Powell are keeping the pressure on US assets, including stocks and the long Treasuries," said Vail Hartman, US rates strategist at BMO Capital Markets in New York.
Chicago Federal Reserve President Austan Goolsbee said on Sunday that he hopes the United States is not moving to an environment where the ability of the central bank to set monetary policy independent of political pressure is questioned.
The Fed, after a series of rate cuts late last year, has left its benchmark policy rate on hold in the range of 4.25 per cent to 4.50 per cent since December.
The Dow Jones Industrial Average fell 937.33 points, or 2.39 per cent, to 38,205.01, the S&P 500 fell 128.08 points, or 2.43 per cent, to 5,154.25 and the Nasdaq Composite fell 446.75 points, or 2.75 per cent, to 15,839.28. MSCI's gauge of stocks across the globe fell 7.78 points, or 0.98 per cent, to 785.64.
Most markets were closed on Friday and some, including most of Europe, remained on holiday for Easter Monday, leading to thinner than usual liquidity. Against a basket of currencies, the dollar slid as low as 97.923, its lowest since March 2022. The currency also fell to a decade-low against the Swiss franc, while the euro briefly broke above $1.15.
The euro was last up 0.94 per cent at $1.1498. Against the Japanese yen, the dollar weakened 0.98 per cent to 140.78. Against the Swiss franc, the dollar fell 1.07 per cent to 0.808.
Cryptocurrencies rose. Bitcoin gained 3.88 per cent to $88,384.03. Ethereum rose 3.07 per cent to $1,638.04. The yield on benchmark US 10-year notes rose 1.9 basis points to 4.346 per cent, from 4.327 per cent late on Thursday.
Spot gold rose 2.6 per cent to $3,414.91 an ounce at 09:26 a.m. ET (1326 GMT). Prices hit a record high of $3,424.25 earlier in the session. Trump's tariffs have roiled financial markets in recent weeks and also remain a big concern for investors.
China on Monday accused Washington of abusing tariffs and warned countries against striking a broader economic deal with the United States at its expense, ratcheting up its rhetoric in the recent trade war between the countries.
First-quarter results from US companies continue to roll in, with reports from top names like Alphabet due this week. Companies and investors are grappling with a tariff landscape that is likely to keep shifting as the Trump administration negotiates with countries.
Oil prices were lower. US crude fell 2.66 per cent to $62.96 a barrel and Brent fell to $66.12 per barrel, down 2.71 per cent on the day.