Gold prices edged up on Thursday, lifted by a weaker dollar and rising uncertainty after a report showed U.S. President Donald Trump was considering replacing Federal Reserve Chairman Jerome Powell as early as September or October.

The report raised concerns about the U.S. central bank's future independence, boosting demand for safe-haven bullion. Spot gold rose 0.2% to $3,339.20 per ounce, as of 0242 GMT. U.S. gold futures rose 0.3% to $3,353.10.

The dollar (.DXY), however, fell to its lowest since March 2022, making dollar-priced bullion cheaper for overseas buyers.

Powell told a U.S. Senate panel on Wednesday that while Trump's tariffs could lead to one-off price increases, persistent inflation risks were significant enough for the central bank to be cautious about further interest rate cuts. "Trump clearly wants a dovish Fed Chair next time around, so an aggressive rate-cutting cycle is likely to weigh on the USD," said Tim Waterer, chief market analyst at KCM Trade.

Bullion tends to perform well during periods of uncertainty and in low-interest-rate environments.

On Wednesday, Trump called Powell "terrible" and said he was considering three or four candidates for the Fed's top job.

Meanwhile, The Wall Street Journal reported that Trump has even considered the idea of ​​announcing a replacement for Powell in September or October.

The market is awaiting US GDP data due later in the day, while also eyeing Personal Consumption Expenditures (PCE) data on Friday. "Gold is basically just floating for now until we get the next US macro data including GDP and core PCE," Waterer said.

The ceasefire between Israel and Iran appeared to be holding on Wednesday as Trump, at a NATO summit, hailed the swift end to the 12-day conflict and said he would seek a commitment from Iran to end its nuclear ambitions in talks next week.

Spot silver edged up 0.2% to $36.36 an ounce, platinum gained 2.3% to $1,385.38, while palladium jumped 5.5% to $1,115.58. (alg)

Source: Reuters