Trump ‘playing with fire’ over Fed’s independence<\/a><\/p>\nA criminal probe into the US Federal Reserve chair threatens to undermine the US dollar and the global monetary system. Local analysts warn the implications for Australia are profound.<\/p>\n
“It’s been vulnerable to a pullback.”<\/p>\n
Silver was also caught in the precious metals sell-off.<\/p>\n
The shiny metal had collapsed to 7 per cent in late Asian trade.<\/p>\n
News broke today that Mr Trump was on the cusp of announcing a new chair for the US Federal Reserve.<\/p>\n
“I’ll be announcing the Fed chair tomorrow morning,” Mr Trump told reporters Thursday night, local time, as he went into a screening of Melania, a documentary about his wife.<\/p>\n
“It’s going to be somebody that is very respected, somebody that’s known to everybody in the financial world.<\/p>\n
“And I think it’s going to be a very good choice. I hope so.”<\/p>\n
Kevin Warsh tipped as new chair<\/p>\n
Current Federal Reserve chair Jerome Powell’s term expires on May 15.<\/p>\n
Mr Trump will choose Mr Powell’s replacement, and has been vocal in recent months about his desire for a chair who will be eager to cut interest rates.<\/p>\n
Mr Powell has insisted on changing interest rates depending on the economic data, rather than any political motive.<\/p>\n
Given elevated inflation, this week he chose to keep US interest rates unchanged.<\/p>\n
Bloomberg today reported that Kevin Warsh is the most likely candidate on the shortlist to be picked.<\/p>\n
Mr Warsh is a US financier and bank executive who served as a Federal Reserve governor from 2006 to 2011.<\/p>\n
And betting markets now have him at an implied 94 per cent probability to be the next chair.<\/p>\n
However, Mr Warsh is seen by the financial markets as less willing to cut interest rates than the other most likely candidate, director of the National Economic Council of the United States, Kevin Hasset.<\/p>\n
Mr Oliver said a more “hawkish” pick in Mr Warsh had financial markets concerned that interest rates may not go as low as they might under Mr Hasset.<\/p>\n
Higher-than-expected future US interest rates saw the US dollar rise, the Australian dollar dive, as well as precious metal prices.<\/p>\n
The price of gold and silver often move inversely to the value of the US dollar.<\/p>\n
“[The Trump announcement] provided a trigger for the pullback,” Mr Oliver said.<\/p>\n","protected":false},"excerpt":{"rendered":"The prices of gold and silver have fallen sharply in Asian trade, sparked by reports US President Donald…\n","protected":false},"author":2,"featured_media":233393,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[64,63,99,2490,231617,5284,231618,231620,171,5285,231619,21097],"class_list":["post-446963","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-au","tag-australia","tag-business","tag-donald-trump","tag-fed-reserve","tag-gold","tag-gold-and-silver-price-drop","tag-kevin-warsh","tag-markets","tag-silver","tag-us-fed-reserve-chair-announcement","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/446963","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=446963"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/446963\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/233393"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=446963"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=446963"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=446963"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}