Spot Gold Reverses Earlier Losses; Last 0.5% Higher at $3,381.17/oz (26 August 2025, 06:15am) Gold prices rose to a two-week high on Tuesday, as the dollar slipped after U.S. President Donald Trump said he was removing Federal Reserve Governor Lisa Cook from her position on the Fed’s board of directors.
Spot Gold falls in early Asian trade on possible profit-taking. The precious metal’s decline is just a corrective move related to profit-taking rather than a structural shift in gold’s broader trend, XS.com’s Rania Gule says in an email. “The fundamental backdrop supporting the precious metal remains intact, both from the perspective of U.S. monetary policy and ongoing global geopolitical risks,” the senior market analyst adds.
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Gold prices rose to a two-week high on Tuesday, as the dollar slipped after U.S. President Donald Trump said he was removing Federal Reserve Governor Lisa Cook from her position on the Fed’s board of directors.
FUNDAMENTALS KEY
* Spot gold GOLD was up 0.5% at $3,384.34 per ounce, as of 0055 GMT, its highest level since August 11. U.S. gold futures GOLD for December delivery gained 0.4% to $3,432.40.
* The U.S. dollar index DXY fell 0.3% against its rivals, making gold less attractive to overseas buyers.
* Trump on Monday took the unprecedented action of firing Lisa Cook, the first African-American woman to serve as a Federal Reserve governor, over claims of mortgage borrowing impropriety.
* Fed Chair Jerome Powell on Friday signaled a possible interest rate cut at the U.S. central bank’s meeting next month, saying that risks to the job market were rising but also noting inflation remained a threat and that a decision wasn’t set in stone.
* Markets are now pricing in an 83% chance of a quarter-point rate cut at the Fed’s September 17 policy meeting, according to CME FedWatch Tool.
* Gold tends to appreciate in a low-interest-rate environment, which reduces the opportunity cost of holding non-yielding bullion.
* Focus now shifts to the Personal Consumption Expenditures Price Index — the Fed’s preferred inflation gauge — due on Friday for more cues on U.S. rate cut path.
* SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.18% to 958.49 tonnes on Monday from 956.77 tonnes on Friday.
Political circus engulfs Fed after Cook’s removal
Of course, it wouldn’t be a day under the White House Big Top without Trump lobbing another grenade at the Fed. But this time it’s no dud — it’s live ordnance. President Trump announced the immediate removal of Fed Governor Lisa Cook, accusing her of falsifying mortgage documents and declaring that “the American people must be able to trust the honesty of those steering the central bank.” The move, posted to Truth Social like a cannon blast, comes just as the Department of Justice begins probing Cook following a referral from FHFA Director Bill Pulte, who alleged possible mortgage fraud.
For Trump, the timing is no coincidence. He’s been steadily tightening the vice on Democratic figures while also putting the squeeze on Powell’s Fed, and this is his boldest strike yet. Cook, who just days ago dismissed the uproar as little more than bullying over a tweet, now finds herself ejected from the policy table she vowed not to abandon.
Markets felt the shock immediately. The Dollar Index buckled, Treasury yields slipped, and S&P 500 futures sagged under the weight of the uncertainty. Traders know when a White House circus becomes a market event — and today, the tent poles rattled. The independence of the Fed, already a fraying banner, looks tattered against the gusts of politics.
What’s left is a central bank suddenly with a missing vote, a looming inflation test on Friday, and a president willing to make personnel changes with the flair of a ringmaster cracking the whip. For the market, the question isn’t just about Lisa Cook — it’s about how many more grenades are stuffed inside Trump’s jacket.