Gold Falls More Than 2% After Powell

Gold prices fell more than 2% today, Monday, as the US dollar jumped after the re-nomination of Federal Reserve Chairman Jerome Powell for a second term,

This fueled expectations that the US central bank would continue the Fed policy.

Gold in spot transactions was down 2.08% at $ 1806.20 an ounce, after hitting its lowest level since November 5 at $ 1804.30.

And US gold contracts fell 2.37% to $ 1807.70 an ounce.

News of Powell’s nomination for a second term and the nomination of Lyle Renard as Vice Chairman of the Federal Reserve pushed the US dollar to the highest level since July 2020. It also sparked a jump in US Treasury yields.

A rise in the dollar would make gold more expensive for holders of other currencies, while higher interest rates would reduce the attractiveness of the non-yielding precious metal.

Financial markets are now expecting that the US central bank will raise its key interest rate by 25 basis points by June, not July as previously indicated.

Among other precious metals, spot silver fell 1.5 percent to $24.21 an ounce, while platinum fell 1.77% to $1013.33, and palladium fell 5.45% to $149.29.