Gold and silver prices tumble as investors get reassurance with Trump’s pick as head of the Federal Reserve

Gold and silver prices plunged on Friday, January 30, as investors reacted to US President Donald Trumps decision to nominate a new chair of the Federal Reserve, while European stock markets closed the week higher and Wall Street edged slightly lower. The sell-off in precious metals began after reports, later confirmed, that Trump had selected former Federal Reserve official Kevin Warsh to replace Jerome Powell as head of the US central bank. Trump confirmed the nomination on Friday via his Truth Social platform, writing that Warsh would be one of the GREAT Fed Chairmen, maybe the best, and praising his reliability and presence.Kathleen Brooks, research director at XTB, said the interesting pick may give the market some hope that Fed independence will be preserved. Trumps repeated public attacks on Powell, whose term ends in May, had previously fuelled investor concerns that the central banks independence could be undermined, a scenario widely viewed as a potential inflation risk for the US economy.Safe-haven assets fell sharply after surging earlier in the week amid uncertainty over Trumps policy direction. Gold dropped by more than eight per cent to below $5,000 an ounce after hitting a record high of $5,595.47 on Thursday, while silver shed about 20 per cent to trade near $90 an ounce a day after reaching an all-time peak above $120.Financial markets endured a volatile week marked by a weaker US dollar, renewed tariff threats from Trump, rising tensions with Iran and concerns about a possible US government shutdown. Asian markets ended the week lower following a technology-led sell-off on Wall Street. Although strong earnings from firms such as Meta, Samsung and SK Hynix buoyed sentiment earlier in the week, worries resurfaced after Microsoft announced a sharp increase in spending on artificial intelligence infrastructure, reviving fears that returns on heavy AI investment may take longer to materialise and that valuations could be stretched after years of tech-driven gains.Oil prices recovered from early losses on Friday after surging the previous day as Trump escalated rhetoric towards Tehran. Megan Fisher, assistant economist at Capital Economics, said the building tensions between Iran and the US had pushed Brent crude to a six-month high, but added that historical precedent, including last years brief IranIsrael conflict involving the US, and ample global oil supply were likely to weigh on prices by the end of 2026.The post Gold and silver prices tumble as investors get reassurance with Trumps pick as head of the Federal Reserve appeared first on Linda Ikeji Blog.