Gold and Silver Prices Plunge as Warsh Fed Pick Eases Monetary Policy Concerns
By
pera
Toasted golden, schmeared with insight. Top of the rack.
Summary
Gold and silver prices experienced their worst single-day declines in decades, with silver plunging 30% and gold tumbling significantly. The sharp sell-off followed news that President Trump was considering Kevin Warsh as a potential replacement for Federal Reserve Chair Jerome Powell, which eased market fears about Fed independence. The market interpreted Warsh as a more hawkish candidate who would be less likely to pursue aggressive monetary easing, leading to a stabilization of the dollar and a reversal of safe-haven trades that had driven precious metals higher in recent weeks.
Key quotes
· 5 pulledSilver plunges 30% in worst day since 1980, gold tumbles as Warsh pick eases Fed independence fear
The Warsh pick should help stabilize the dollar some and reduce (though not eliminate) the asymmetric risk of deep extended dollar weakness by challenging debasement trades – which is also why gold and silver are sharply
Gold and silver prices plunged on Friday, following weeks of gains as investors poured money into safe havens
Trump picks Warsh
National Economic Council Director Kevin Hassett had been the favorite to replace Powell for some time, but Warsh became the front-runner in prediction markets in recent days
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