• Trump threatens to fire Fed Chair Jerome Powell over interest rates.
• Global markets react negatively to concerns about Fed independence.
• Dollar weakens significantly against major currencies.
• French Finance Minister warns of risks to U.S. economy and credibility.
• China's onshore stocks remain stable amid global market turmoil.

Donald Trump’s growing discontent with Federal Reserve Chair Jerome Powell reached a boiling point this week when Trump threatened to terminate Powell if the Fed did not cut interest rates to stimulate economic growth amidst the ongoing tariff war. "If I want him out, he’ll be out of there real fast, believe me,” Trump stated, pointing toward a potential confrontation between the Fed and the White House that could destabilize financial markets, according to Dawn.

The impact of Trump’s remarks on the global economy has been immediate; the U.S. dollar has weakened significantly, sinking to a three-year low against the euro and a seven-month low against the yen. Analyst Vishnu Varathan remarked that "the markets are already on edge due to escalating geopolitical tensions," highlighting how Trump's actions raise further uncertainty for global investments, as reported by Reuters.

French Finance Minister Eric Lombard cautioned that firing Powell could undermine the credibility of the dollar and result in increased costs for servicing U.S. debt. He described the potential fallout as a “profound disorganization of the country’s economy,” emphasizing the seriousness of Trump’s threats, according to South China Morning Post.

Simultaneously, Asian markets reacted with caution, showing mixed results as concerns lingered over Trump's tariffs and their implications. The Nikkei 225 index fell by 1.2%, while China’s CSI 300 index displayed relative resilience, attributed to state interventions and stable economic data, as noted by South China Morning Post.

Overall, the tumult surrounding Trump’s approach towards the Federal Reserve not only highlights the tension within U.S. economic policy but also signals potential instability for the global financial system, with markets responding to the unpredictability surrounding U.S. leadership, according to insights from both India Times and New York Times.