Gold slips after Trump backs down from threat to fire Fed chief
Bullion’s safe-haven appeal fades as US president reconsiders threats to dismiss Jerome Powell
23 April 2025 - 07:37
byAnmol Choubey
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Bengaluru — Gold prices fell more than 1% on Wednesday as US President Donald Trump backed down from threats to dismiss Federal Reserve chair Jerome Powell and expressed optimism for a trade deal with China, denting bullion’s safe-haven appeal.
Spot gold fell 1.2% to $3,339.53/oz by 4.28am GMT. US gold futures fell 2% to $3,349.80.
The hint of US-China negotiations and Trump backing down his threat to remove Powell “caused the sell-off in gold price to hit a kind of a very extreme oversold level in the short-term perspective here”, said Kelvin Wong, senior market analyst, Asia Pacific at Oanda.
US stocks and the dollar rebounded after Trump on Tuesday withdrew his threats to fire Powell after days of intensifying criticism of the central bank chief for not cutting interest rates.
A stronger dollar makes gold more expensive for overseas buyers.
Trump also expressed optimism that a trade deal with China could “substantially” reduce tariffs on Chinese goods, hinting that the final deal will not “be anywhere near” current tariff rates.
US treasury secretary Scott Bessent said he believed there would be a de-escalation in US-China trade tension, but negotiations with Beijing had not yet started and would be a “slog”.
“There is no form of a bullish exhaustion yet from the upper bond level so there could still be potential movement on the upside for the gold,” Wong said.
Fed Bank of Minnesota president Neel Kashkari said it was too soon to know how short-term borrowing costs may need to be adjusted for Trump’s tariffs and their expected impact on inflation and the economy.
Gold, considered a hedge against global uncertainty and inflation, hit its 28th record high this year on Tuesday, surging to $3,500 for the first time.
JPMorgan said it expected to see gold prices crossing the $4,000/oz milestone next year.
Spot silver rose 0.6% to $32.70/oz, platinum was up 0.1% at $959.72 and palladium lost 0.2% to $934.26.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Gold slips after Trump backs down from threat to fire Fed chief
Bullion’s safe-haven appeal fades as US president reconsiders threats to dismiss Jerome Powell
Bengaluru — Gold prices fell more than 1% on Wednesday as US President Donald Trump backed down from threats to dismiss Federal Reserve chair Jerome Powell and expressed optimism for a trade deal with China, denting bullion’s safe-haven appeal.
Spot gold fell 1.2% to $3,339.53/oz by 4.28am GMT. US gold futures fell 2% to $3,349.80.
The hint of US-China negotiations and Trump backing down his threat to remove Powell “caused the sell-off in gold price to hit a kind of a very extreme oversold level in the short-term perspective here”, said Kelvin Wong, senior market analyst, Asia Pacific at Oanda.
US stocks and the dollar rebounded after Trump on Tuesday withdrew his threats to fire Powell after days of intensifying criticism of the central bank chief for not cutting interest rates.
A stronger dollar makes gold more expensive for overseas buyers.
Trump also expressed optimism that a trade deal with China could “substantially” reduce tariffs on Chinese goods, hinting that the final deal will not “be anywhere near” current tariff rates.
US treasury secretary Scott Bessent said he believed there would be a de-escalation in US-China trade tension, but negotiations with Beijing had not yet started and would be a “slog”.
“There is no form of a bullish exhaustion yet from the upper bond level so there could still be potential movement on the upside for the gold,” Wong said.
Fed Bank of Minnesota president Neel Kashkari said it was too soon to know how short-term borrowing costs may need to be adjusted for Trump’s tariffs and their expected impact on inflation and the economy.
Gold, considered a hedge against global uncertainty and inflation, hit its 28th record high this year on Tuesday, surging to $3,500 for the first time.
JPMorgan said it expected to see gold prices crossing the $4,000/oz milestone next year.
Spot silver rose 0.6% to $32.70/oz, platinum was up 0.1% at $959.72 and palladium lost 0.2% to $934.26.
Reuters
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