GOLD SINKS AS RISK APPETITE IMPROVES ON TRUMP-POWELL CALM
GOLD SINKS AS RISK APPETITE IMPROVES ON TRUMP-POWELL CALM
Gold prices experienced a significant decline on Wednesday, April 23, 2025, as investor sentiment shifted towards risk-on assets amid easing geopolitical tensions and positive developments in U.S.-China trade relations.
The precious metal's retreat reflects a reduced demand for safe-haven assets in light of these factors.
President Donald Trump retracted his earlier threat to remove Federal Reserve Chair Jerome Powell, signaling a commitment to maintaining the central bank's independence.
This move alleviated concerns about potential political interference in monetary policy, boosting investor confidence.
Treasury Secretary Scott Bessent indicated that the U.S. is considering reducing tariffs on Chinese goods, moving towards a more conciliatory approach in trade negotiations.
This development raised hopes for a de-escalation of trade tensions between the world's two largest economies.
The combination of Trump's supportive stance on Powell and positive trade developments led to a surge in global stock markets, a stronger U.S. dollar, and a decline in gold prices.
Investors shifted their portfolios towards equities and other risk assets, reducing the appeal of gold as a safe-haven investment.
Spot gold prices fell nearly 2% to $3,318.71 per ounce, while U.S. gold futures dropped 2.7% to $3,328.10.
This decline follows a record high of over $3,500 per ounce earlier in the week, driven by concerns over potential political instability and trade tensions.
