Jerome Powell downplays signals from precious metals.Shutterstock
· Shutterstock
It’s not just the record price of gold that’s really shocking people. This is how Powell is trying to separate price action from the Fed’s reaction function.
“Jerome Powell says not to read too much into rising gold prices,” Cointelegraph captioned a clip on X during a press conference, explaining his answer to a question about the surge in gold prices.
Related: Trade war reignites, gold, silver bets reset
At the same time, these initiatives are no small feat.
Data from Plus500 shows that gold prices recently broke above $5,000 an ounce, even before the price extended into the $5,600 area, driven by safe-haven demand due to geopolitical tensions and uncertainty about future Federal Reserve policy.
More gold:
CME Group analysis said that a combination of interest rate cut expectations, geopolitical pressure and central bank diversification have pushed precious metal prices to record or near-record levels, and after such a sharp rise, a sharp correction remains a real threat.
When I put the pieces together, it feels like the Fed is quietly saying, “We’re seeing this, but we’re not going to let gold bully us,” which is not the message metals traders want to hear.
RELATED: Jerome Powell’s net worth, salary and job as Fed chair
If Powell tries to calm things down, that won’t work for the hard money crowd. Peter Schiff, who has been discussing the situation with gold and silver for years, immediately described the market’s reaction as a referendum on the Fed.
“I was too busy to listen to Powell’s press conference. But judging by the reaction of precious metals, his speech did not improve confidence in the U.S. economy or the dollar. Gold rose more than $200 an ounce and silver gained more than $4,” Schiff wrote on X.
This was the pure reading of gold at the time: the metal was reacting not only to the data, but to Powell himself.
In a follow-up
His point is simple: If you stop looking at the lights on your dashboard that warn you about easing policy, are you really going to be surprised when the market stops trusting you?
That fits with the way he talks about the move more broadly.
Finance Magnates quoted Schiff as predicting that gold prices will rise to $6,000 and silver will rise to triple-digit levels, which will reflect the imminent loss of control of inflation and the dollar.
Binance highlighted Schiff’s comments, saying that the surge in gold and silver shows that investors are preparing for a more serious financial crisis and that the metals should be viewed as core safe-haven assets rather than niche trades.
I don’t think you have to agree with his price targets to take this broader warning seriously: There is a real constituency that believes the Fed is behind the curve, and higher metals prices are the market’s way of expressing that view.
Beneath the noise of social media, there is a digital story that cannot be ignored.
The Economic Times pointed out that the Federal Reserve kept its policy interest rate unchanged and emphasized that inflation is still above the 2% target, indicating that the Federal Reserve will not be in a hurry to cut interest rates significantly. According to Finance Magnates, the futures market is still pricing in a rate cut of about 150 basis points in 2026, which incorporates significant assumptions of easing policy into gold and silver prices.
CME said the hit to real yields, coupled with geopolitical risks and central bank buying, were the main reasons why metals prices have risen so quickly so far.
This leaves you in an uncomfortable middle.
RELATED: Fidelity fund managers send recession message
On the one hand, Powell is telling you not to read too much into precious metals and not to expect policy to be driven by its every move. On the other hand, the metals and futures curves are trading as if the Fed is already halfway down the road to easing monetary policy.
Here’s my summary of what the current data and commentary means for people managing their own money.
-
Gold has already made huge gains in two years and surged significantly over $200 on FOMC day, meaning if you buy now, your forward returns will be even more dependent on timing.
-
According to Schiff’s X post, silver posted a single-day gain of more than $4 after Powell’s comments and has been even more volatile than gold, amplifying both upside and downside moves.
-
The story is driven by real yields, rate cut expectations and confidence in the Fed, as well as spot inflation.
This doesn’t tell you what to do. It tells you that if you buy here, you’re not just betting on metals. You’re betting on a specific view that Powell will or won’t change his current stance.
If I were making or revisiting a plan right now, I would first decide what job I wanted the metal to do. Are you using gold and silver as long-term insurance against inflation and political risk, or are you trying to ride a wave of momentum that you hope is not over yet?
Here’s how I translate all of this into actual decisions:
-
If your gold and silver positions surged after the recent surge, I would seriously consider trimming your original allocation and locking in some gains rather than letting hedging become your biggest risk.
-
If you have never owned metals and feel you “have” to after this week, I would tend to build a position slowly via dollar cost averaging rather than chasing the FOMC intraday $200 move all at once.
-
If your main concern is that the Fed has truly stopped focusing on gold, as Schiff fears, I would rely more on gold as a core hedge and view silver and miners as smaller high-beta satellites.
None of this requires you to predict the exact wording of your next press conference. It does require you to respect the fact that Powell has told you in so many words that the Fed will not take a spike in gold prices as a mandate, while a vocal corner of the market insists a spike in gold prices is a verdict on the Fed’s credibility.
Related: Major banks revise 2026 gold price targets
This article was originally published by TheStreet on January 29, 2026, and first appeared in the Investment section. Click here to add TheStreet as your preferred source.
