President Donald Trump’s change in tone toward Federal Reserve Chair Jerome H. Powell was influenced by senior advisers who urged him to ease his criticism of the central bank, according to three sources familiar with the matter. On Monday, the stock market dropped sharply as Trump labeled Powell a “major loser,” raising concerns that the president might fire the Fed chief. However, by Tuesday, Trump softened his stance, stating he had “no intention of firing” Powell and attributing media speculation to exaggeration. This shift followed advice from administration officials, including Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick, who argued that engaging in a public battle with the Fed could further destabilize financial markets already affected by trade disputes and tariffs. The decline in stock prices made Trump more receptive to retaining Powell than he might have been previously. “I would like to see him be a little more active in terms of his idea to lower interest rates,” Trump remarked. “It’s a perfect time to lower interest rates. If he doesn’t, is it the end? No, it’s not, but it would be good timing.” The Federal Reserve operates independently to set interest rates without political interference, aiming to protect monetary policy from short-term political goals. Although analysts believe it unlikely Trump would attempt to dismiss Powell, the mere possibility triggered a rare simultaneous drop in U.S. bond and stock prices as well as the dollar. — new from The Washington Post