Gold prices eased from weekly highs during Asian trade on Wednesday as traders booked profits on the metal’s recent rebound ahead of a highly anticipated decision by United States President Donald Trump regarding new Federal Reserve appointments.
By 3:50 pm AEST (5:50 am GMT), spot gold was down $9.36, or 0.3%, to US$3,371.61 per ounce, after touching a high of $3,391 during Tuesday’s American session.
The pullback comes as the U.S. Dollar enters a period of consolidation near multi-day lows, weighed by growing market speculation over Federal Reserve policy direction and concerns about political influence over the central bank.
In an interview with CNBC on Tuesday, President Trump said he would soon announce a temporary replacement for Fed Governor Adriana Kugler, who resigned last Friday.
Trump also confirmed that four candidates have been shortlisted to succeed Fed Chair Jerome Powell, whose current term ends in May 2026, and that a nomination decision is expected by the end of the week.
These developments come at a time of heightened sensitivity around Fed independence, with markets increasingly pricing in the likelihood of a rate cut in September amid renewed signs of economic softness.
On Tuesday, data from the Institute for Supply Management (ISM) revealed that the services PMI fell to 50.1 in July, down from 50.8 in June, and well below market expectations of 51.5 - adding to concerns over the health of the US economy.
The weaker-than-expected data contributed to sustained pressure on the U.S. dollar, which continues to trade at the lower end of its recent range against major peers, further underpinning gold’s resilience.
Looking ahead, investors are awaiting speeches from several Fed officials, along with further announcements from President Trump regarding both trade policy and Federal Reserve appointments, which are likely to set the tone for the next move in gold prices.