Gold Rises as Fed Independence Concerns Fuel Safe-Haven Demand

Gold Gains on Political Uncertainty
Gold prices climbed in Asian trading on Tuesday as investors sought safety after U.S. President Donald Trump moved to fire Federal Reserve Governor Lisa Cook, raising concerns over the central bank’s independence. Spot gold rose 0.3% to $3,375.29 per ounce, while October futures were up 0.2% to $3,423.95/oz by 00:24 ET (04:24 GMT). Spot prices briefly touched a two-week high of $3,386.49.

Trump’s Latest Attack on the Fed
Trump announced Cook’s dismissal in a letter, citing allegations of mortgage fraud. Cook rejected both the allegations and Trump’s authority to remove her, vowing to continue her role. If successful, the move could give Trump greater influence over the Fed’s seven-member board, which already includes two of his nominees — Governor Christopher Waller and Vice Chair Michelle Bowman. Both supported Trump’s push for a July rate cut.

The dismissal follows Trump’s repeated clashes with Fed Chair Jerome Powell, who has resisted immediate rate cuts but recently signaled that a September cut was possible amid labor market weakness. Analysts warn that the president’s repeated interference risks damaging the Fed’s credibility and the U.S. economic outlook.

Precious Metals Supported by Dollar Weakness
Safe-haven buying wasn’t limited to gold. Spot silver gained 0.7% to $38.85/oz, while platinum added 0.1% to $1,346.40/oz. A softer dollar helped support the gains, though the dollar index recovered above 98 points after early weakness.

Industrial Metals Extend Rally
Industrial metals also benefited from the weaker dollar and lingering optimism over potential Fed easing.

• LME copper futures rose 0.7% to $9,848.85/ton, while COMEX copper added 0.4% to $4.55/pound.
• Nickel and iron ore extended recent gains, with iron ore supported by news that Rio Tinto (ASX:RIO) suspended output at a Guinea mine following a fatal accident.

Market Outlook
The prospect of Trump reshaping Fed leadership heightens political and economic risks, supporting safe-haven demand in gold and silver. At the same time, industrial metals are finding strength from expectations of Fed rate cuts that could bolster growth-sensitive commodities.