Gold steadies after surging on worries over Fed independence

Gold steadied after surging on Monday on worries over the Federal Reserve’s independence after the Trump administration threatened Chair Jerome Powell with a criminal indictment.

Bullion traded near $4 585 an ounce after jumping 2% in the previous session as Powell said the potential indictment was a continuation of attempts to pressure the central bank. The latest attack on the Fed revived the “sell America” trade, with the dollar dropping on Monday and Treasuries selling off across the curve.

President Donald Trump’s aggressive calls for lower interest rates have threatened to undermine the Fed’s ability to control inflation and contributed to the so-called debasement trade where investors sell the dollar and other assets vulnerable to political and fiscal shocks. The Department of Justice probe into Powell prompted lawmakers from the president’s own Republican party and Treasury Secretary Scott Bessent to warn Trump the move could be bad for markets.

Attacks on the Fed helped propel gold to successive record highs last year, along with heightened trade and geopolitical risks and central bank buying. With Trump seizing Venezuela’s leader, threatening to take Greenland and renewing his campaign against Powell, precious metals are carrying that momentum through to 2026.

That prompted Citigroup to forecast that gold will reach $5 000 an ounce and silver will get to $100 an ounce in the next three months. The white metal has outperformed gold thanks to a historic short squeeze, US tariff fears and rising industrial use, though borrowing costs for the metal have since eased.

“We expect the bull market to stay intact in the near term amid heightened geopolitical risks, ongoing physical market shortages, and renewed uncertainty on Fed independence,” Citi analysts said in a note. “Our base case is for eventually moderating geopolitical risks to weigh on hedging demand for precious metals later in the year, particularly on gold.”

Spot gold fell 0.3% to $4 584.16 an ounce as of 10:28 a.m. Singapore time. The Bloomberg Dollar Spot Index was flat. Silver dropped 0.8%, while platinum was down 1.4% and palladium down 2%.

© 2026 Bloomberg

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