Gold prices drop as Wednesday's Asian session begins, which is sponsored by Trump's comments that he is not looking to fire Fed Chair Jerome Powell. At the time of writing, XAU/USD plunges over 1% and trades at $3,333.

Recently, US President Donald Trump said that he had no intention of firing Powell. He said, "The press runs away with things. No, I have no intention of firing him. I would like to see him be a little more active in terms of his idea to lower interest rates."

Earlier news from the United States (US) Treasury Secretary Scott Bessent revealed that he saw a de-escalation with China, which improved the market mood, which is a headwind for Bullion prices. Since the headlines, the yellow metal drifted lower by $50 from around $3,420 to $3,370.
Despite this, uncertainty about US trade policies and President Donald Trump's attacks on the Federal Reserve (Fed) can boost demand for Gold and push prices higher. So far in the year, Gold prices have remained up almost 29% due to geopolitics and Trump's swinging mood.

Last week, Chair Jerome Powell said the Fed would remain data-dependent and even flagged the chance of a stagflationary scenario, acknowledging, "We may find ourselves in the challenging scenario in which our dual-mandate goals are in tension."

Amid this backdrop and an uncertain economic outlook, investors flock to safety, as the flows of Gold ETFs are picking up, according to the World Gold Council (WGC).

"Global physically backed gold ETFs1 reported strong inflows in March totaling US$8.6bn. This helped drive total Q1 flows of US$21bn (226t) to the second highest quarterly level in dollar terms, only behind Q2 2020's US$24bn (433t)," revealed the WGC.

The US 10-year Treasury yield falls two basis points to 4.395%.
US real yields followed suit, edges down two bps to 2.175%, as shown by the US 10-year Treasury Inflation-Protected Securities yields
In rates markets, money market traders have priced in 91 basis points of Fed rate cuts by the end of 2025, with the first cut expected in July.
Data-wise, this week's US economic docket will be packed with Fed speakers, S&P Global Flash PMIs, Durable Goods Orders, and the University of Michigan Consumer Sentiment final reading.

Source: Fxstreet