Gold Slips as Risk Appetite Improves, Trump Eases Powell Dismissal Fears
Gold prices dipped slightly in Asian trading on Thursday as investor sentiment improved after President Donald Trump downplayed the likelihood of firing Federal Reserve Chair Jerome Powell prematurely.
Broader metal markets were also subdued, pressured by a firm U.S. dollar, which held near a three-week high following persistent inflation data for June.
Despite the drop, safe-haven demand for gold remained somewhat resilient amid ongoing concerns about Trump’s upcoming tariffs, set to take effect in just over two weeks. Meanwhile, platinum and silver continued to outperform gold.
As of 00:49 ET (04:49 GMT), spot gold was down 0.2% at $3,342.09 per ounce, while September gold futures slipped 0.3% to $3,348.40 per ounce.
Trump: Firing Powell ‘Highly Unlikely’
Speaking Wednesday, Trump said it was “highly unlikely” he would remove Fed Chair Powell, though he didn’t entirely rule it out, citing potential fraud in the Fed’s renovation project as a possible justification.
Speculation around Powell’s job had intensified after Trump increased criticism of the Fed, with some Republican allies even calling for Powell’s immediate dismissal. Trump has faulted Powell for delaying rate cuts and urged immediate action to protect the economy.
Fed officials, including Powell, have signaled that interest rates are likely to remain unchanged until the full inflationary impact of Trump’s tariffs is assessed.
Trump’s softer tone helped improve risk sentiment slightly, leading to a minor pullback in gold demand and a lift in U.S. stock markets.
Dollar Holds Firm as Rate Cut Expectations Cool
The U.S. dollar remained stable, bolstered by fading expectations for a rate cut this month. Recent data showing sticky consumer and producer inflation in June has led markets to believe the Fed will likely hold interest rates steady at its upcoming meeting.
The dollar’s strength has limited upside for metals, keeping pressure on prices across the board.
Markets are now focused on upcoming U.S. retail sales and jobless claims data, expected later Thursday, for additional insight into the economy’s trajectory.
Other Metals Steady to Higher
- Spot platinum edged up to $1,424.55 per ounce, after closing above $1,400 on Wednesday. ANZ analysts noted the move could signal more upside ahead.
- Spot silver rose 0.2% to $37.9945 per ounce.
- On the industrial side, LME copper futures held flat at $9,629.75 per ton, while COMEX copper futures inched up to $5.5267 per pound.
