Yahoo Finance Gold Rises as Trump Criticizes Fed
Investing.com - Gold prices rose on Friday as U.S. President Donald Trump criticized the Federal Reserve for increasing interest rates.
Comex gold futures for August delivery rose 0.47% to $1,229.70 a troy ounce as of 10:29 AM ET (14:29 GMT).
Trump said in an interview on CNBC that he does not approve of how the Fed is approaching monetary policy. The Fed raised rates twice this year and is expected to raise rates at least once more before the end of the year.
St. Louis Federal Reserve Bank President James Bullard responded to Trump’s comments, saying the Fed would not be impacted.
“The [Fed] has a mandate to keep inflation low and stable and obtain maximum employment for the U.S. economy, so people can comment, including the president and other politicians, but it’s up to the committee to try to take the best action we can to achieve those objectives,” he said.
Higher rates are a negative for gold as the precious metal, which does not pay interest, struggles to compete with yield-bearing assets when rates rise.
Meanwhile, Trump said in an interview on CNBC that he is ready to impose tariffs on $500 billion worth of Chinese goods to the U.S. if China does not back down on its trade policies.
The dollar slumped after Trump's comments. Gold falls as the dollar rises, as it is denominated in the U.S. currency and is sensitive to moves in the dollar.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, fell 0.64% to 94.37.
Bullion becomes more expensive for holders of other currencies when the dollar rises and cheaper when it falls.
Other metals were higher on the Comex, with silver futures rising 0.64% to $15.50 a troy ounce. Among other precious metals, Platinum Futures increased 2.91% to $829.80, while Palladium Futures jumped 1.94% to $883.50 an ounce. Copper futures gained 1.91% to $2.747 a pound.
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