The Trump administration summons Powell, shocking allies; US stocks may trigger a risk-off wave on Monday opening

The Trump administration summoned Federal Reserve Chair Powell and threatened criminal charges. This move not only provoked a counterattack from Powell but also shocked some of Trump's allies.

Currently, the market is generally concerned that the incident could disrupt financial stability, and it is expected that Wall Street may see a risk-off wave at the Monday opening.

Sources familiar with the matter revealed that Trump's allies' main concern is that legal battles could disrupt the bond market and intensify policy conflicts with the Fed, potentially leading Powell to refuse to leave office after his term ends in May this year.

Moreover, although Powell may no longer serve as Fed Chair after his term ends, his Fed Board member term extends until January 2028. It remains unclear whether he will step down as usual after his term.

It is worth noting that Trump has previously criticized Fed Chair Powell's interest rate policies multiple times and indicated he would announce his successor. The recent summons controversy could disrupt the leadership transition process.

Currently, Trump's team is assessing the potential impact of summoning Powell, and Wall Street's reaction will be a focus of market attention on Monday. The market generally views this move as a threat to the Fed's independence.

Wall Street institutions are also highly alert, calling the move "deeply unsettling," and warning that it could seriously threaten central bank independence and trigger market risk-off sentiment.

Following the news of the Trump administration summoning Powell, the US dollar index fell sharply, while gold and silver prices surged at one point. This phenomenon seems to indicate that the market is preemptively signaling a risk-off stance before the opening.