NEW YORK (Reuters) -Uncertainty over Federal Reserve Chair Jerome Powell's tenure is prompting investors to assess potential market reactions should there be an premature change in leadership at the U.S. central bank.

President Donald Trump has repeatedly criticized Powell for not cutting U.S. rates quickly enough. He has frequently raised the possibility of ousting him before his term is up in ten months, while also saying that firing him would be "unlikely."

Trump said on Thursday he had a "good meeting" with Powell after he visited the Federal Reserve's headquarters in Washington to tour the site of a $2.5 billion renovation of two historical buildings the White House criticizes as overly costly and ostentatious. He said it is not necessary to fire Powell.

Investors have been considering various scenarios, including Trump dismissing Powell, the Fed chief stepping down, or a new nominee being named well before the scheduled end of Powell's term.

Forecasting how equities, the U.S. dollar, and Treasury yields would react to each outcome is difficult, market participants said.

However, brief turbulence last week - when reports emerged that Trump was considering firing Powell - triggered a 0.7% decline in the S&P 500 and a 0.9% drop in the dollar, offering some clues to possible market reactions, they added.

"Financial markets have sent clear warning signals about the consequences of political interference," Jack Ablin, chief investment officer at Cresset Capital, said.

"YOU'RE FIRED"

While deemed the most unlikely scenario, the biggest risk for markets is if Trump were to fire Powell. Such a move would be viewed as an assault on the independence of the Fed, something the market counts on, investors said.

Based on the scale of gyrations markets recently experienced, strategists at Deutsche Bank estimate the dollar could tumble as much as 6%, potentially a record large drop.

Deutsche Bank's strategists estimate the 10-year yield could jump up about 20 basis points while the 30-year yield could soar 45 basis points. On Thursday, the 10-year yield was at 4.413%, while the 30-year bond was at 4.942%.

While equities might eventually find something to like in a new Fed Chair who might be more amenable to rate cuts, investors said stocks would likely initially sell off if Powell is shown the door.

Cresset's Ablin said the drop in stocks would be more extreme than the less than 1% slide spurred by last week's reports on Powell's imminent firing.

Ousting Powell would raise the risk that Trump would try to make an even bigger play to take over the Fed, David Seif, chief economist for developed markets at Nomura, said.

"Loss of Fed independence would lead to a very big increase, I think, in inflation uncertainty, and that would lead investors to demand much more compensation for locking their money up for that long, leading to a much steeper yield curve," Seif said.

Gold would be one asset that could benefit in the circumstance, Aaron Hill, chief analyst at broker FP Markets, said. The price of the safe haven metal, already near record highs set this year at around $3,400 an ounce, could leap higher, he said.

Nor is the market going to draw much distinction between Powell being fired for cause or otherwise, investors said.

"I QUIT"

Should Powell resign, concerns about the Federal Reserve's independence would linger, but markets may avoid a prolonged period of uncertainty that could arise from potential legal battles if Powell were dismissed. Powell has said he would refuse to leave office early even if Trump asked.

While that might yield a slightly less volatile reaction in the near term, it will confirm apprehensions about the Federal Reserve straying from its dual mandate of maximum employment and stable prices, analysts said.

The chair is only one of 12 voting members at the central bank's monetary policy meetings. Part of the role is to build consensus with a large group of policymakers.

"I think that's telling you that Trump is willing to work that hard to break down the leader of the board ... that he's going to come after the rest of the board if they don't do what the new Fed chair basically does," Benjamin Ford, researcher at macro research and strategy firm Macro Hive said.

"I think that almost cements Trump's view for interest rates."

The dollar would be particularly vulnerable, hit with the double whammy of rate cuts and loss of investor confidence.

"A politically compliant Federal Reserve could trigger severe and lasting market disruptions across multiple asset classes, fundamentally altering the global financial landscape," Cresset's Ablin said.

SHADOW FED

The most benign outcome for markets would be if Trump were to merely nominate a new chair and let Powell remain in place until his term expires in May.

Treasury Secretary Scott Bessent said on Wednesday the Trump administration was not in a rush to nominate a new chair to replace Powell. The administration would likely announce a successor in December or January, he said.

"I don't know that the equity market would necessarily view that negatively," Mark Hackett, chief market strategist at Nationwide, said.

"You're obviously going to believe that the next person is going to be more dovish on average than Powell would be, but I think that assumption is there anyway," he said.

An appointment who talks loudly about lowering interest rates could erode the value of the dollar, investors said.

"It would probably weigh on the dollar more and more as we go through and towards the new Fed chair," Macro Hive's Ford said.

While not as drastic as the other two scenarios, the presence of a shadow chair who offers potentially clashing views with the sitting central bank leader on monetary policy could sow confusion. Any choice deemed as being under Trump's thumb could do lasting damage to the public perception about the Fed's independence.

"It's really hard to put the toothpaste back in the tube," Nationwide's Hackett said.