Spot gold fell 5% after a report that the Trump administration is preparing to nominate Kevin Warsh for Federal Reserve chair. The news lifted the US dollar, triggering a broad selloff across metals. Investors reacted swiftly, pulling funds from safe‑haven assets and shortening duration of positions.

Warsh, a former Fed governor, is seen as a hawkish candidate who could tighten policy, pushing the dollar higher. Gold, traditionally a hedge against currency moves, reacts sharply when expectations of higher rates surface, prompting traders to reallocate portfolios and reduce risk exposure in gold.

Short‑term volatility may persist as markets digest the Fed’s potential stance. Investors eye the dollar’s trajectory and Fed minutes for clues. A sustained dollar rally could keep gold prices subdued, while any policy surprise might revive demand for the precious metal in the global market.

Analysts will monitor the official nomination announcement and subsequent policy statements. A confirmation of Warsh could tighten the monetary outlook, tightening risk appetite. Meanwhile, commodity traders will adjust hedging strategies, and institutional investors may shift capital back into equities if the dollar strengthens further today.