After Wall Street previously downplayed risks from President Donald Trump’s trade war, investors are starting to take his tariff threats more seriously.

Trump continued his letter-writing blitz, warning the EU and Mexico on Saturday that they face 30% tariffs unless they reach trade deals by Aug. 1. The EU said Sunday it will delay its retaliatory tariffs that were due to take effect on Monday to give negotiations with the U.S. more breathing room.

Trump officials have also claimed Powell has mismanaged the Fed and point to renovations of the central bank’s headquarters, with National Economic Council Director Kevin Hassett even indicating that Powell’s job could be at stake.

When asked by ABC News if the renovation could be used as a reason to fire Powell, Hassett said, “I think that whether the president decides to push down that road or not is going to depend a lot on the answers that we get to the questions that Russ Vought sent to the Fed.”

He added that whether Trump has the authority to remove Powell is being explored, “But certainly, if there’s cause, he does.” 

Deutsche Bank said financial markets are underpricing the risk that he could be ousted.

Futures tied to the Dow Jones Industrial Average dropped 214 points, or 0.48%. S&P 500 futures were down 0.50%, and Nasdaq futures fell 0.55%.

The yield on the 10-year Treasury edged down 0.6 basis point to 4.417%. Gold was flat at $3,364 per ounce, while the U.S. dollar was up 0.2% against the euro and down 0.12% against the yen.

U.S. oil prices rose 0.58% to $68.85 per barrel, and Brent crude climbed 0.16% to $70.79.

Key economic indicators are due in the coming week. The consumer price index will come out on Tuesday and the producer price index is due on Wednesday, offering fresh clues as to how much tariffs are impacting inflation.

That comes as tariffs have yet to trigger a spike in prices, though many companies are still drawing down inventories that were stockpiled prior to the duties going into effect.

Also on Wednesday, the Federal Reserve’s beige book survey of business and economic conditions will be issued, while retail sales will be available on Thursday, and housing starts come out on Friday. Those datasets will also provide insights into how consumers and companies are responding to tariffs.

Several Fed policymakers will speak this coming week amid intense pressure from the White House to lower interest rates.

Earnings seasons get going in earnest over the coming week, with Wall Street eager to find out how much of the tariff are impacting margins. The top U.S. banks will report second-quarter results, starting with JPMorgan Chase, Citigroup and Wells Fargo on Tuesday. In the tech sector, streaming leader Netflix and chip giant TSMC report on Thursday. Among industrials, results from Alcoa, GE Aerospace and 3M are also due.

On Thursday, Delta Air Lines beat earnings and revenue forecasts while also reinstating its 2025 profit outlook because demand had stabilized.