Gold prices set a new record

The price of gold hit a record high of $4,600 an ounce on January 12 as the Trump administration’s criminal investigation into Federal Reserve Chairman Jerome Powell drew investors back to the safe-haven asset, Reuters reported.

Spot gold rose 1.7% to $4,584.12 an ounce on January 12, after hitting a record high of $4,600.33 earlier in the day. U.S. gold futures for February delivery rose 2.1% to $4,595 an ounce.

“With the Fed’s independence now openly challenged, the ‘political risk’ discount that is usually reserved for emerging markets is weighing on the U.S. dollar, driving investors into hard assets,” said Zain Vawda, an analyst at OANDA’s MarketPulse.

Wall Street futures fell and the dollar fell the most in three weeks as tensions between the Fed and the Trump administration escalated, Reuters reported.

Powell said the threat of impeachment over congressional testimony he gave last summer was a “pretext” for the Trump administration to gain more leverage over interest rates, which the U.S. president wants to slash.

Trump said he was also considering a range of strong responses, including military options to quell protests in Iran.

The unrest in Iran comes amid a show of American strength on the international stage, the removal of Venezuelan President Nicolas Maduro and discussions about buying Greenland.

Non-yielding assets such as gold tend to perform well in low interest rates and times of geopolitical or economic uncertainty, Reuters reported.

Spot silver rose 4.8% to $83.78 an ounce after hitting a record high of $84.60 earlier in the day.

Spot platinum rose 3.5% to $2,352.90 an ounce after hitting a record high of $2,478.50 on Dec. 29.

Palladium rose 2.5% to $1,860.43 an ounce.

Tags: prices, USA, Gold