“to cheat, to drive a hard bargain,” 1824, from Jew (n.) (cf. gyp, welsh, etc.).

The campaign to eliminate it in early 20c. was so successful that people began to avoid the noun and adj., too, and started using Hebrew instead.

“Now I’ll say ‘a Jew’ and just the word Jew sounds like a dirty word and people don’t know whether to laugh or not.” [Lenny Bruce (1925–1966)]

Of course, “gyp” refers to gypsies and “welsh” refers to welshmen, and of course its no longer P.C. to refer to something in the context of a specifically cultural bias. Per the answer above, that only began in the 20th century, when we became more aware of the negativity and practice.