If Trump launched the Federal Reserve Powell, “both the currency and the bond market can collapse,” according to Deutsche Bank.

Written by the International President of FX George Saravelos, exploring what may happen if President Trump reaches his way and is forced Jerome Powell to head the American Federal Reserve in order to replace him with a person agreed with Trump that interest rates should be less.

“We think the market reaction will be great,” says the note. “Experimental and academic evidence on the impact of the loss of the central bank’s independence is somewhat clear: in extreme cases, both the currency and the bond market can collapse with high inflation expectations, a decrease in real return and increased circles on risks against the background of institutional corrosion.”

Saravelos rejected more comment when arriving luck.

The note is important because although most investors do not think it is possible Trump can already replace Powell before his mandate ends next May, they don’t think he is so impossible. Books on polymarketExchange of encryption predictions, currently put the chance to remove Powell by 19 %.

Until recently, Trump’s hatred of a height has been expressed mostly through angry social media. Powell gave a title, “It is too late,” He was it “It resembles a child like inflation that is not for several months, and refuses to do the right thing.”

But last week, the threat against Powell became more realistic when Ross Fair, director of the Administration and Budget Office, was Send Powell’s message a message Request to answer a series of questions about renewing the headquarters of the Federal Reserve.

Powell gave seven working days to respond – the deadline that ends on July 21.

Vough claims that Powell misleading Congress when he recently witnessed that the renewal did not include luxury touches such as the surface garden with a group of deficiencies.

“There are no new water features. There is no beehive and there is no terrace on the roof,” Powell said.

Fior says that these elements were in the plan approved by the National Capital Planning Committee, and if Bowl changes building plans, this is a violation of the law of national capital planning because the renewal does not follow the approved plan.

P. to request Inspector General Audit Office Renewal.

Saravilus said in his observation that this dispute over construction plans could have trackers on asset markets.

“It is clear that investors are likely to explain such an event as a direct insult to independence, which puts the central bank under extremist institutional coercion. With the inclusion of the federal reserve at the top of the dollar’s global monetary system, it also shows that the consequences will bounce on the borders of the United States.”

Saravilus said that the removal of Powell will be much worse than President Nixon’s imposition of Arthur Burns on the Federal Reserve in the 1970s. Nixon and Burns, such as Trump, were installed to reduce interest rates – and thus nurtured the spread of that contract.

Today, “the United States runs a much larger dual deficit and the position of negative foreign assets, the capital markets are more open and competing in an inconsistent manner to asset assets in the United States, and the global exchange rate system carries a fixed infection.

The first warning mark will be a sharp drop in the value of the US dollar. Greenback has already decreased by 9.75 % this year, its worst performance in the first half years.

“It is difficult to determine the effect on the FX and the prices, but in the first 24 hours of the announcement of the Powell removal, we expect a decrease in the darkening from 3 % to at least 4 % accompanied by a report of 30-40 Poita per second in fixed income in the United States led by the rear match. Like the experience in April.

The situation will be similar to what happened in Turkiye, where President Tayyip Ardoğan maintains political control over the central bank of Turkey.

Like Trump, Erdogan has a strong hatred for high interest rates, and as a result, the Turkish inflation rate is now 35 %.

“In short, we consider the removal of President Powell as one of the biggest risks of events in the coming months,” Saravilus concluded.