Gold hits record high as market worries Trump may fire Fed chairman

Gold surged to record highs as concerns that President Donald Trump may fire Federal Reserve Chairman Jerome Powell sparked a sell-off in U.S. stocks, bonds and the dollar.

Gold rose 2.9% on Monday to top $3,486 an ounce. Trump's call for an immediate rate cut by the Federal Reserve, a move seen as jeopardizing the central bank's independence, sent the dollar to its lowest level since 2023.

"The rapid rise in gold prices this year tells me that the market has less confidence in the United States than ever before," said Lee Liang Le, analyst at Kallanish Index Services. She said the narrative of a "Trump trade" has morphed into a "sell America" ​​narrative.

Gold has surged by a third in 2025 as trade tensions hammered markets and eroded trust in dollar assets. Inflows into gold ETFs and central bank buying have supported gold's gains, which have risen every month this year.

Gold's rally has intensified this year, with some banks gradually becoming more bullish on the metal. Among them, Goldman Sachs predicts that gold could reach $4,000 an ounce by the middle of next year.

However, the recent surge has exceeded some closely watched indicators, suggesting that the rally may pause at some point. The 14-day relative strength index for gold prices broke through 79, above the 70 level that indicates an asset is overbought.

As of now, spot gold prices have risen 1.8% to $3,484.38 an ounce. The dollar index fell again after falling 0.7% on Monday. Silver prices were basically flat, while palladium and platinum rose.