INVESTMENT.RAKCER.ID – Gold prices plunged more than 3%, falling below US$4,800 per ounce on Monday, February 2, 2026, extending losses from the previous session after the precious metal suffered its steepest decline in more than a decade.
Friday’s drop was triggered by reports that US President Donald Trump plans to nominate Kevin Warsh, who is widely viewed as a more hawkish candidate, to lead the Federal Reserve.
Profit-taking also emerged following an uninterrupted rally that had pushed gold prices to record highs.
That surge was driven by strong demand from central banks and devaluation trades, as investors shifted from currencies and bonds into physical assets amid concerns over rapidly rising government debt.
Rising geopolitical and economic uncertainty, along with concerns about the independence of the Federal Reserve, further strengthened gold’s appeal as a safe-haven asset.
Momentum buying amplified the gains, with waves of purchases by Chinese speculators inflating the rally’s bubble and exacerbating the subsequent sell-off when they took profits.
Gold is primarily traded in the London over-the-counter (OTC) market, the US futures market (COMEX), and the Shanghai Gold Exchange (SGE). A standard futures contract represents 100 troy ounces.
Gold is considered an attractive investment during periods of political and economic uncertainty. Around 50% of global gold consumption is used for jewelry, 40% for investment purposes, and 10% for industrial use.
The world’s largest gold producers include China, Australia, the United States, South Africa, Russia, Peru, and Indonesia.
The largest consumers of gold jewelry are India, China, the United States, Turkey, Saudi Arabia, Russia, and the United Arab Emirates.Gold prices displayed on Trading Economics are based on over-the-counter (OTC) financial instruments and contracts for difference (CFDs).
These prices are intended for reference purposes only and should not be used as the sole basis for trading decisions. Trading Economics does not verify the data and disclaims any obligation to do so.
Gold later extended its losses, falling more than 3% to below US$4,720 per ounce on Monday, continuing the sharp decline that marked its steepest drop in over a decade.
The continued decline was reinforced by the same factors: expectations of tighter monetary policy under a more hawkish Federal Reserve leadership, profit-taking after a prolonged rally, and heightened volatility driven by speculative momentum—particularly from Chinese investors—who intensified both the rise and the subsequent fall in prices.