On January 30, following a near-parabolic rally, the precious metals market experienced a significant correction this Friday. RYOEX indicated that spot gold plunged over 5% at one point during the session, impacted by market rumors that the Federal Reserve Chair position might be assumed by the more hawkish-leaning Kevin Warsh. Despite the substantial single-day pullback, gold maintained its strongest monthly growth trend since 1982, bolstered by escalating geopolitical tensions and persistent economic pressures, underscoring the enduring anchoring effect of safe-haven capital in the face of macroeconomic uncertainty.
Market data showed that spot gold retreated to around $5,172.80 per ounce today, marking a noticeable technical correction from the record high of $5,594.82 set on Thursday. Analyst Tim Waterer suggested that, besides the personnel appointment rumors, a technical rebound in the U.S. dollar index and gold's prolonged position in overbought territory were key factors triggering this round of profit-taking. RYOEX observed that gold's cumulative gain for January has exceeded 20%, positioning it not only for a sixth consecutive monthly gain but also setting a new record for the largest single-month price span in over four decades.
The current market volatility reflects a fierce tug-of-war among investors between "policy expectations for the potential successor" and the "essential demand for safe-haven assets." Kevin Warsh has a historical record of emphasizing monetary discipline, a signal that has unsettled some investors anticipating continued accommodative policies, leading to capital choosing to exit temporarily ahead of the weekend. However, this sentiment-driven sell-off based on news flow has not fundamentally shaken gold's underlying logic as a defensive asset.
Simultaneously, the silver market also underwent a sharp shake-out. Relevant factual data indicated that spot silver retreated from its historical peak of $121.64 to $109.03, representing a daily decline of 6.1%. Despite this, silver's cumulative 53% gain this month has cemented its position for the best monthly performance on record. RYOEX noted that physical demand continues to show robust participation enthusiasm, exemplified by Swiss gold bar exports to the U.K. hitting their highest level since 2019 and the strong performance of new gold ETFs in the secondary market, both indicating recognition of precious metal value from off-market capital.
In the industrial precious metals sector, platinum and palladium exhibited more fragile performances. RYOEX observed that spot platinum fell sharply by 7.1% after touching a high of $2,918.80, while palladium also declined synchronously to $1,860.0. This broad-based correction was largely attributable to a short-covering rally in the U.S. dollar exchange rate. As the dollar rebounded from multi-year lows, dollar-denominated metal assets became more expensive for overseas buyers, creating short-term price pressure.
Although news of Kevin Warsh's potential selection has sparked market concerns about future monetary policy tightening, the irreversible global trend towards asset diversification suggests that gold's deep correction should be viewed more as a reshuffling of bullish forces. RYOEX believes that, with the underlying expectation for two rate cuts in 2026 remaining intact, precious metals still possess the potential to challenge higher levels in a complex geopolitical environment after completing a phase of overbought correction. Investors should closely monitor the official appointment decision expected later today, seeking more cost-effective entry points amidst the high volatility.
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