US Treasury Secretary Scott Bisent Accuses China of Gold Market Speculation
US Treasury Secretary Scott Bisent has accused China of contributing to the significant fluctuations in the gold market over the past week, labeling Chinese speculation as "unregulated," which has resulted in a sharp increase in the price of the precious metal.
In an interview with Fox News, Bisent stated:
"Gold prices have experienced disruptions in China, where they were forced to tighten margin requirements. Therefore, it seems to me that gold has seen a strong rise due to speculation."
His comments came in response to inquiries about the record surge in gold prices, which has been fueled by speculative buying, geopolitical tensions, and concerns regarding the independence of the Federal Reserve, which experienced a sudden decline last week.
These disruptions have also impacted the currency market, as the US dollar recorded its first weekly gain since early January, while the Dow Jones Industrial Average surpassed the 50,000-point mark for the first time in history, reflecting investor optimism about the US economy and corporate profits.
With the upcoming midterm elections in November, Bisent viewed the performance of the Dow as evidence that the US economy is on an upward trajectory that will benefit citizens.
Regarding Federal Reserve policy, Bisent noted that the central bank will proceed cautiously before attempting to reduce its balance sheet, stating:
"I do not expect swift action. They have transitioned to a policy of abundance, which requires a larger balance sheet, so I think they will likely wait and need at least a year to make their decision."
Additionally, Bisent commented on the nomination of Kevin Warsh, President Trump's candidate for the Federal Reserve chair, praising his experience and qualifications:
"He will be very independent, but he will recognize that the Federal Reserve is accountable to the American people."
During a Senate hearing, Bisent addressed the possibility of Warsh facing legal action if he does not lower interest rates as Trump prefers, emphasizing that the final decision rests with the President. He added that Trump's remarks were intended as a joke and highlighted the President's expectations that Warsh would align with his views on interest rates.
Gold and silver continue to attract global investor interest as markets closely monitor the movements of the US Federal Reserve and their implications for the economy and financial markets.
