NEW YORK, Jan 30, 2026, 06:17 EST — Premarket
- Spot gold dropped 5.5%, hitting $5,076.18 an ounce by 5:40 a.m. ET, after a brief slide to $4,941.79
- The pullback comes after Thursday’s record and as markets gear up for Trump’s Fed chair announcement
- Silver, along with other precious metals, plunged steeply
Gold prices plunged on Friday, dipping below $5,000 an ounce briefly as a stronger dollar triggered profit-taking after January’s sharp rally. Spot gold dropped 5.5% to $5,076.18 by 5:40 a.m. ET, hitting a low of $4,941.79 earlier. U.S. gold futures fell 4.7% to $5,104.31.
The drop is significant because bullion had just hit another record on Thursday and is still on track for its biggest monthly gain since 1999, despite Friday’s pullback. Gold reached $5,594.82 the previous day, with investors flocking to the metal as a safe haven — then retreating as the dollar steadied ahead of President Donald Trump’s anticipated pick for the next Federal Reserve chair. “I still believe several gold-supportive drivers remain in place, but after the strong rally in recent weeks a consolidation is healthy,” UBS analyst Giovanni Staunovo said. Reuters
Just two days ago, gold seemed unstoppable. Spot prices surged about 4% on Wednesday, closing in on $5,400, and barely budged after the Fed held rates steady. “The rally in the precious metals has kind of taken on a life of its own at this point,” said Peter Grant, vice president and senior metals strategist at Zaner Metals. Still, he cautioned the market looked overbought. Reuters
The market’s back on Washington. Trump plans to announce Jerome Powell’s replacement this Friday, following a White House meeting with former Fed Governor Kevin Warsh, Reuters reported. Traders are watching closely, viewing this as a quick litmus test of the Fed’s independence. “I think it’s going to be a very good choice. I hope so,” Trump said Thursday. Reuters
The move partly reflects what traders term “hawkishness” — a tilt toward tighter policy that tends to push bond yields and the dollar higher. Warsh has pushed for shrinking the Fed’s balance sheet, the pile of bonds and assets it holds, and that discussion has directly influenced currencies this week.
Gold swung wildly throughout the session. One spot source reported bullion at $5,100.40 an ounce by 5:56 a.m. ET, marking a 5.63% drop for the day. This highlights just how quickly prices shifted amid thinning liquidity in early New York trading.
Gold bulls face the risk of a messy unwind. A stronger dollar could drain overseas demand, while a scramble to offload leveraged bets might drag prices below what fundamentals justify. But if Trump’s pick shocks the market or signals a gentler Fed stance, the trade could reverse sharply.
Traders are closely eyeing $5,000 to see if it holds as a key psychological level. Meanwhile, silver’s steeper drop has sparked renewed debate over whether January’s rally was fueled more by speculation than actual physical demand.
After Friday’s Fed chair news, all eyes turn to U.S. labor data. The Bureau of Labor Statistics will release the January Employment Situation report on Friday, Feb. 6, at 8:30 a.m. ET.
