Gold prices rose slightly on Thursday as markets reacted to renewed criticism of the Federal Reserve by United States President Donald Trump, which pushed the U.S. dollar to fresh three-year lows and reignited concerns over the central bank’s independence.
By 3:40 pm AEST (5:40 am GMT), spot gold was trading at US$3,335.63 per ounce, up US$3.63 or 0.1%, consolidating above the key US$3,225 support level.
The latest leg lower in the dollar following speculation that President Trump may replace Federal Reserve Chair Jerome Powell as early as September or October.
Trump further escalated criticism on Wednesday, calling Powell “terrible” and revealing he is weighing “three or four” potential replacements.
Such remarks have stirred concerns over the future independence of the U.S. central bank, increasing demand for safe-haven assets like gold.
In his testimony before the U.S. Senate this week, Powell struck a cautious tone, suggesting that while Trump’s tariffs could cause a one-off price rise, the risk of persistent inflation warranted patience in further rate adjustments.
He reiterated that the Fed is not inclined to cut rates in the near term until clearer inflation signals emerge.
Despite these dovish signals, gold has faced resistance in resuming its upward momentum, weighed down by the easing in Middle East tensions and Powell’s reluctance to pre-commit to a July rate cut.
Looking ahead, traders will monitor key U.S. economic data releases on Thursday, including durable goods orders, weekly jobless claims, and pending home sales, for new catalysts.
However, the market may remain range-bound until Friday’s release of the personal consumption expenditures (PCE) price index, considered the Fed’s preferred inflation gauge.
