Gold and silver prices plummet in a day... Profit-taking rush following Trump's Fed chair nomination

The international gold and silver prices, which had been on a recent surge, plummeted by more than 10% in just one day. This is interpreted as a result of investors rushing to take profits after U.S. President Donald Trump nominated former Fed director Kevin Wash, who is considered to have a relatively less dovish stance, as the next chair of the Federal Reserve (Fed).

According to Reuters on the 30th (local time), the spot price of gold fell by 9.5% from the previous session, trading at $4,883.62 per ounce. This comes just a day after it surged to a record high of $5,594.82, breaking the $5,500 per ounce mark for the first time. The closing price of April gold futures on the New York Mercantile Exchange (COMEX) also dropped by 11.4% to $4,745.10 per ounce.

After surpassing the $5,000 per ounce mark for the first time on the 26th, gold prices continued to rise due to concerns over the infringement of the Fed's independence and the weakness of the dollar. However, as expectations grew that the likelihood of a rapid easing of Fed monetary policy would decrease, the mood shifted dramatically.

The adjustment in silver prices was even more pronounced. The spot price of silver traded at $83.99 per ounce, down 27.7% from the previous session, falling below the $100 mark. Silver prices had surged over 150% last year and continued to rise this year, but this sharp drop has raised concerns about short-term overheating. However, as of this month, silver is still up by about 17%.

The sell-off spread across precious metals, with platinum falling by 19.18% and palladium by 15.7%, among other metals experiencing significant declines.

On Wall Street and beyond, former director Wash has been regarded as the 'safe choice' with the highest level of trust in the financial markets among the candidates for the next Fed chair. As concerns remained that President Trump might nominate a more dovish figure than expected, the selection of a candidate closer to a hawkish stance weakened the preference for safe assets.

Meanwhile, the value of the dollar rebounded. The dollar index, which indicates the value of the dollar against six major currencies, rose by 0.8% to 97.07 as of 3:20 PM Eastern Time, compared to the previous session. The dollar index had recently fallen to its lowest level in four years due to the controversy over the Fed's independence and President Trump's comments about the merger with Greenland, shaking confidence in dollar assets.