Gold Prices Slide to 2-1/2-Week Low Amid Hawkish Fed Chair Speculation

Investing.com – Gold prices slumped to their lowest level in more than two weeks on Wednesday, following a report that Republican senators were leaning towards John Taylor to be the next Federal Reserve chief.

U.S. President Donald Trump used a luncheon with Senate Republicans on Tuesday to get their views on who he should tap to be the next head of the central bank, according to senators who attended.

A source familiar with the matter said Trump polled the Republicans on whether they would prefer Stanford University economist John Taylor or current Fed Governor Jerome Powell for the job, and more senators preferred Taylor.

Taylor is seen as someone who may put the Fed on a path of faster interest rate increases compared to current Fed chair Janet Yellen, whose term expires next February.

In an interview aired in recent days, President Donald Trump said he is “very, very close” to making his decision.

That helped send U.S. benchmark 10-year Treasury note yields to their highest since March, supporting the dollar and dampening the appeal of bullion.

Comex lost $3.60, or around 0.3%, to $1,274.35 a troy ounce by 2:55AM ET (0655GMT) after touching its worst level since Oct. 6 at $1,272.60 earlier in the session.

The yellow metal finished lower on Tuesday with strength in the U.S. stock market dulling demand for the precious metal.

Elsewhere on the Comex, dipped 5.9 cents, or 0.4%, to $16.90 a troy ounce. Among other precious metals, platinum fell 0.4% to $921.70, while palladium shed 0.8% to $953.75 an ounce.

Meanwhile, dropped 3.5 cents, or 1.1%, to $3.163 a pound. It hit its best level since Aug. 2014 at $3.239 in the last session, boosted by expectations of strong economic growth in China, the world’s top user of the red metal.

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