The Dollar's Slide: How Trump's Fed Attacks Are Weakening the Greenback
3min read The U.S. dollar has reached multi-year lows against the euro and Swiss franc, a dramatic shift fueled by President Donald Trump’s relentless criticism of Federal Reserve Chair Jerome Powell and threats to remove him from office. As of April 2025, the dollar traded at 0.8685 against the euro—the lowest since 2017—and 0.848 versus the Swiss franc, near 2015 levels. These declines underscore a market losing confidence in the greenback’s stability amid escalating political interference in monetary policy. 
A Currency in Crisis
The dollar’s weakness is no accident. Since 2020, the USD/EUR exchange rate has trended downward, from an average of 1.14 in 2020 to 1.08 in 2024, with the five-year low of 0.8685 hit in April 2025. Similarly, the USD/CHF rate has fallen from an average of 0.909 in April 2024 to 0.85 by late August . . This decline accelerated in 2025 as Trump’s attacks on the Fed intensified, with the dollar index hitting a three-year low of 97.923 in April.
Trump’s Assault on the Fed’s Independence
The root cause of this turmoil lies in Trump’s public denigration of Powell, whom he has labeled a “major loser” and “Mr. Too Late.” On April 17, Trump threatened to remove Powell, claiming, “If I want him out, he’ll be out real fast.” Such rhetoric directly challenges the Fed’s independence—a pillar of U.S. economic credibility since the 1930s. Legal precedents bar dismissal of Fed chairs without “malfeasance,” but the Trump administration is pushing to overturn this via a Supreme Court case targeting independent agencies.
This political overreach has spooked investors. Kevin Hassett, Trump’s economic adviser, confirmed the White House is “studying” Powell’s removal, even as analysts warn of catastrophic market consequences. Renaissance Macro’s Neil Dutta noted that firing Powell could “upset the bond market,” triggering a spike in long-term interest rates.
Market Chaos and Safe-Haven Shifts
The fallout is visible across asset classes:
- Stocks: The S&P 500 plunged 2.36% on April 22, erasing nearly 18% of its value since early 2025. The Nasdaq Composite fell 2.55%, and the Dow Jones lost 2.48%. .
- Bonds: U.S. Treasury yields surged, with the 10-year note hitting 4.4% and the 30-year nearing 5%, as investors priced in policy uncertainty.
- Currencies: The euro breached 1.05 against the dollar, while the Swiss franc rose to levels not seen since 2015.
- Safe Havens: Gold hit a record $3,480 per ounce, and Bitcoin surged 5% in April as investors fled the dollar.
The Long-Term Risks
Strategists warn that the erosion of Fed independence could have lasting effects. Principal Asset Management’s Michael Goosay cautioned that undermining the Fed’s autonomy would “further pressure confidence in U.S. dollar assets,” especially among foreign investors holding $23 trillion in Treasury securities. Chicago Fed President Austan Goolsbee added that political interference risks creating a “cycle of higher inflation, weaker growth, and higher unemployment.”
Bank of America’s investor surveys reflect this anxiety: a net 61% of fund managers now expect the dollar to weaken over 12 months—the most pessimistic outlook in 20 years. Goldman Sachs’ Michael Brown warned that removing Powell could strip the dollar of its reserve currency status, triggering a “rush to the exit” from U.S. assets.
Conclusion: A Currency’s Credibility at Stake
The dollar’s decline is not just a technical chart event—it’s a crisis of confidence in U.S. institutions. With the USD/EUR rate at 0.8685 and USD/CHF near 0.848, markets are pricing in the risks of a Fed stripped of independence. If Trump succeeds in ousting Powell, the precedent could destabilize global financial systems for decades.
The numbers tell the story: a 2.36% single-day drop in the S&P 500, a 4.4% spike in 10-year Treasury yields, and gold’s 20% surge since 2024 all signal a loss of faith. For investors, the lesson is clear: when the world’s reserve currency becomes a political football, the safest bets are no longer in dollars. The greenback’s fate now hangs on whether the Fed—and the courts—can withstand the White House’s assault.
