Gold prices fell more than 3% on Wednesday, continuing their decline from a record high. The drop came as investors shifted towards riskier assets following reassuring comments from U.S. President Donald Trump on the Federal Reserve and trade relations with China.
By 1:43 p.m. ET (1743 GMT), spot gold was down 3% to $3,281.60 an ounce. This follows Tuesday’s record high of $3,500.05. U.S. gold futures also fell, dropping 3.7% to settle at $3,294.10 an ounce.
Investor confidence improved after Trump said he had no plans to remove Federal Reserve Chair Jerome Powell. This came after days of criticism from the president over the Fed’s decision not to cut interest rates. Trump also suggested that progress was being made in trade talks with China.
“The market is starting to move past the shock caused by tariffs,” said Phillip Streible, chief market strategist at Blue Line Futures. “We are seeing a shift away from safe haven assets, with money moving back into big names like Apple and Tesla.”
The U.S. dollar strengthened and broader financial markets stabilized in response to Trump’s comments. U.S. Treasury Secretary Scott Bessent added that trade talks with China will only move forward if the current high tariffs are lowered.
Gold, which is often seen as a safe investment in times of uncertainty, has gained more than 26% in 2025. This rise has been driven by central bank purchases, concerns over tariffs, and strong investor demand.
Ole Hansen, head of commodity strategy at Saxo Bank, warned that gold’s recent price surge and quick reversal could lead to a deeper correction. “The sharp move above $3,500 and the sudden pullback have raised short-term risks,” he said in a note.
In other precious metals, silver rose 3% to $33.48 an ounce. Platinum gained 1.1% to $969.10, while palladium remained steady at $935.59.
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