(Kitco News) – Gold and silver futures are sharply down in midday U.S. trading Monday, with gold notching a two-week low. The metals’ prices were under pressure overnight and then selling pressure accelerated when it reported early this morning that President Biden plans to keep Federal Reserve Chairman Jerome Powell for another term. December gold was last down $41.10 at $1,810.40 and December Comex silver was last down $0.421 at $24.36 an ounce.
The yellow metal slumped, the U.S. dollar index rallied to a 15-month high and U.S. Treasury yields rose when it was announced Biden chose Powell to continue in his position for another term.
Speculation had been that Biden might choose the more monetary-policy-dovish Lael Brainard as Fed chair. With Powell remaining as chairman of the Federal Reserve, traders and investors reckon U.S. monetary policy will remain on its present course, compared to notions that Brainard as a new Fed chair would have leaned easier on U.S. money policies.
Sell stop orders were triggered in gold futures when prices dropped below several key near-term technical support levels this morning, which drove prices still lower. It can be argued that the Powell news was just an excuse for the shorter-term gold and silver futures traders to ring the cash register and take profits after recent good price gains.
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