Gold climbs to two-week high as Trump shakes up Fed

WEB DESK: Gold prices rose to their highest level in two weeks on Tuesday after a surprise move by US President Donald Trump unsettled markets and weighed on the dollar.

Spot gold was up 0.2 percent at $3,371.28 per ounce at 0309 GMT, after touching its strongest level since August 11 earlier in the session. US gold futures for December delivery held steady at $3,418.90.

Dollar slips as traders turn cautious

The dollar index fell 0.2 percent against major rivals, making gold more appealing for overseas buyers. Analysts said the decline came after Trump announced he was removing Federal Reserve Governor Lisa Cook from her position, a decision described as unprecedented.

Cook, who made history as the first African-American woman to serve as a Fed governor, faced allegations of impropriety related to mortgage borrowing.

Tim Waterer, chief market analyst at KCM Trade, noted that Trump’s remarks had “put traders a little bit on edge,” adding that the uncertainty had triggered renewed safe-haven flows into gold.

He said investors believed Trump might be reshaping the Fed into a more dovish institution, a shift that could weaken the dollar further and support bullion prices.

Rate cut hopes support bullion

The prospect of lower US interest rates also added to the appeal of non-yielding gold. Fed Chair Jerome Powell, in a speech last Friday, suggested that policymakers were considering a rate cut at the central bank’s next meeting.

He pointed to growing risks in the job market but also stressed that inflation concerns remained, signalling that the final decision was not yet certain.

Markets will now keep a close eye on Friday’s release of the Personal Consumption Expenditures Price Index, the Fed’s preferred inflation gauge, for clearer signs of the direction of US monetary policy.

Meanwhile, holdings in the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.18 percent on Monday to 958.49 metric tons.

In other precious metals, silver climbed 0.3 percent to $38.67 per ounce, platinum was little changed at $1,341.83, while palladium advanced 0.8 percent to $1,095.49.

Gold price in Pakistan

Gold prices in Pakistan began the week on a quiet note, holding steady in the local market after a sharp climb over the weekend.

According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of gold per tola on Monday stood firm at Rs359,800, while the rate for 10 grammes was unchanged at Rs308,470. Silver also held its ground, trading at Rs4,121 per tola.

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