Trump has repeatedly urged Powell to cut the short-term interest rate that the central bank controls. The Fed typically reduces its rate during an economic downturn to encourage more borrowing and spending, and raises it to cool the economy and fight inflation when prices rise.

On Monday morning, Trump again lashed out at Powell on his Truth Social, calling the Fed chair "a major loser" and demanding he lower interest rates "NOW." The stock market, which had begun to calm from tariff-induced panic, quickly plunged, with the S&P 500 closing down 2.3%.

President Donald Trump could be setting up Fed Chair Jerome Powell as a 'scapegoat' if a recession hits, according to an MSU economist.