Trade Magnates -Gold prices dropped today below key level at 1,300$ increasing speculation to the next head of the Federal Reserve will be hawkish. Gold futures reach to week low of 1288$ by 13:00 GMT after reaching its highest level since sept 26th at 1308$ on Monday.
Gold, prices rose on Monday in response to the tension over Iraqi and Kurdish forces near the oil fields in Kirkuk. Gold has been always considered as one of the strongest safe-haven commodity, but with President Trump, favouring John Taylor, Stanford economist, to head the fed, the yellow metal has dropped considering the new head of fed reserve to be more hawkish than current Chair Janet Yellen.
Investors and analyst are watching closely and waiting on the meeting between the U.S. President and Yellen later this week searching for the rightful candidate for Yellen’s position. In addition to John Taylor, Jerome Powell – current fed governor, and Kevin Warsh – former fed official, are on the list of potential candidates.
With Yellen’s term due in February 2018, and with the US Dollar gaining strength, the chances of rate hike is increasing by the end of this year.
Trump is also due to meet with Yellen later in the week as part of his search for a new candidate for her position, a source familiar with plans for the meeting said which will consequently affect the Gold prices increasing the cost of holding.