Spot Gold pulled back from a record high of $5,594.82/oz. on Friday, retreating more than 4% on the day, amid market speculation that the next Federal Reserve Chair could adopt a more hawkish policy approach.
Still, the yellow metal was on course for its strongest monthly advance since 1982, being up over 20% so far in January.
US President Donald Trump said on Thursday that he would announce his pick to replace Fed Chair Jerome Powell on Friday. There has been speculation that it would likely be former Fed Governor Kevin Warsh.
The US Dollar rebounded from a four-year low, but was still on track for a second consecutive weekly loss. A firmer dollar makes dollar-priced Gold less appealing to international investors holding other currencies. Part of that rebound came after the Federal Reserve’s decision to leave borrowing costs on hold.
“So, a potentially less dovish Fed Chairman pick, a rebound in the dollar and gold giving way to overbought conditions have contributed to the decline in the price of the precious metal,” KCM Chief Trade Analyst Tim Waterer was quoted as saying by Reuters.
Spot Gold was last down 4.08% on the day to trade at $5,151.06 per troy ounce.
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