NEW YORK: Gold prices declined on Wednesday after U.S. President Donald Trump backed off threats to fire the Federal Reserve chair and U.S. Treasury Secretary Scott Bessent hinted at easing trade tensions, denting the metal’s safe-haven appeal.
FUNDAMENTALS
Spot gold fell 1.2% to $3,340.92 an ounce by 0013 GMT. U.S. gold futures fell 2% to $3,349.20.
On Tuesday, Trump backed off from threats to fire Federal Reserve Chair Jerome Powell after days of intensifying criticisms of the central bank chief for not cutting interest rates.
The president also expressed optimism that a trade deal with China could “substantially” reduce tariffs.
Meanwhile, Scott Bessent said he believes there will be a de-escalation in U.S.-China trade tensions, but negotiations with Beijing have not yet started and would be a “slog”.
Following this, the dollar regained some ground after hitting a three-year low, making gold more expensive for other currency holders.
Non-yielding gold, considered a hedge against global uncertainty and inflation and tends to thrive in a low-interest-rate environment, notched its 28th record high on Tuesday as it surged to the $3,500-per-ounce mark for the first time.
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