Donald Trump’s escalating confrontation with the US central bank has sent shockwaves through global markets, driving gold to a fresh all-time high as investors sought refuge from mounting political risk in the world’s largest economy.
Gold surged to around $4,600 an ounce on Monday, while silver moved close to record territory, as fears grew over political interference in the independence of the Federal Reserve. The US dollar weakened sharply, with the dollar index falling 0.32 per cent against a basket of major currencies.
The flight to safe-haven assets followed remarks by Jerome Powell, who said a criminal investigation into his conduct was part of an effort to intimidate the central bank and undermine its ability to set interest rates free from political pressure.
Despite the turmoil, Wall Street equities eked out modest gains. The S&P 500 rose 0.16 per cent, the Dow Jones Industrial Average added 0.17 per cent, and the Nasdaq climbed 0.26 per cent. Bond markets were more unsettled, with the yield on the benchmark 10-year US Treasury edging up to 4.18 per cent as investors questioned the long-term credibility of US monetary governance.
In the UK, the FTSE 100 finished slightly higher, while sterling strengthened to $1.34 against the dollar, reflecting the greenback’s broader weakness.
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