Gold Hits Two-Week High on Fed Turmoil, Rate-Cut Bets

Gold climbed above $3,370 per ounce on Tuesday, its strongest level in two weeks, as political uncertainty and shifting monetary policy expectations drove safe-haven demand.

The move followed President Donald Trump’s dismissal of Federal Reserve Governor Lisa Cook, citing alleged mortgage fraud. The decision has intensified concerns over the Fed’s independence.

Adding to the momentum, Fed Chair Jerome Powell signaled last Friday that a September rate cut remains on the table, citing labor-market risks, though he stressed inflation pressures persist and no decision is finalized.

Futures markets now price in an 83% chance of a 25bps cut next month. Attention turns to Friday’s release of the PCE price index, the Fed’s preferred inflation gauge, for further policy clues.