J.P. Morgan warned in a note that Trump's pressure on the Federal Reserve and threats to fire Chair Powell could undercut central bank independence and increase inflation risks.

If President Donald Trump were to fire Federal Reserve Chair Jerome Powell, it could have unintended and severe consequences that reverberate throughout the US economy and global markets.

Michael Brown of Pepperstone discusses how the markets could potentially react if President Trump attempted to remove Fed chairman Jerome Powell before his term ends next May.

Republican senators warned Trump not to fire Fed Chair Jerome Powell, citing risks to market stability and the Fed’s independence.

If President Trump gets his way and removes Jerome Powell as chairman of the U.S. Federal Reserve, the market reaction would be swift and brutal, Deutsche Bank’s George Saravelos argues. It could collapse the currency and bond markets,

Explore why Fed independence is crucial for market stability, the impact of tariffs on inflation, and the risks of undermining Federal Reserve credibility. Read what investors need to know.

Analysts have warned of serious financial fallout if Trump follows through. Deutsche Bank strategist George Saravelos said in a Friday note that firing Powell would represent “a direct affront to Fed independence ” and predicted a 3 to 4 percent drop in the dollar within 24 hours.

President Trump’s potential removal of Federal Reserve Chair Jerome Powell is one of the largest underpriced risks to markets, according to a Deutsche Bank strategist. George Saravelos, the bank's global head of foreign-exchange research,

Reports of Trump firing Fed Chair Powell caused major indexes to fall midday Wednesday, but losses were pared as Trump backed off.