Gold Holds High as Fed Under Trump's Attack and Middle East Heats Up
Gold prices tended to stabilize after a sharp surge on Monday, fueled by market concerns about the independence of the Federal Reserve (The Fed). President Donald Trump's administration has again issued serious threats against the US central bank, including the possibility of criminal charges, prompting investors to seek safe-haven assets like gold.
Gold bullion was trading around US$4,588 per ounce, after previously rising around 2%. Fed Chairman Jerome Powell, in written and video statements, emphasized that the threats should be viewed as part of ongoing political pressure on the central bank. This has heightened market concerns about the stability of US monetary policy.
Trump's repeated attacks on the Fed were a key driver of gold prices hitting record highs over the past year. Political interference is seen as weakening the central bank's ability to control inflation, depressing the US dollar and government bonds, and increasing gold's appeal as a long-term store of value.
In Tuesday morning trading in Asia, the spot gold price fell slightly by 0.2% to US$4,587.96 per ounce. The Bloomberg Dollar Spot Index moved flat, while silver fell 1.2% after surging more than 6% the previous day. This decline in gold is considered a technical correction following a strong rally.
However, gold price weakness is expected to be limited due to geopolitical tensions in the Middle East. President Trump stated that the US would impose 25% tariffs on countries doing business with Iran. Escalating protests in Iran and the potential for US military action have kept gold in demand as a safe-haven asset, keeping its price high amid global uncertainty. (az)
Source: Newsmaker.id
