Gold and Silver Safe-Haven Assets Rebound Again... Volatility Intensifies
Trump Pressures Warsh for Rate Cuts
Republican Dissent Emerges Over Warsh’s Confirmation
After U.S. President Donald Trump nominated former Federal Reserve (Fed) Governor Kevin Warsh as the next Fed Chair, safe-haven assets have experienced volatility. Gold, silver, and the dollar, which had plunged after the nomination, rebounded as of 9:30 a.m. on February 2, 2026 (Korea Standard Time). The renewed preference for safe assets is attributed to the expectation that Warsh, known for favoring tightening policies, will find it difficult to resist President Trump’s pressure to cut interest rates. Experts have warned that the greater the uncertainty surrounding U.S. monetary policy, the higher the market volatility will become.
◆"He Won't Disappoint"-Trump’s Pressure on Warsh Spurs Gold Prices to Rebound
The prices of gold and silver, which had plummeted on news of Warsh’s nomination as the next Fed Chair, are now rebounding across the board. As of 6:30 p.m. (local time) on February 1, international gold prices were up 2.20% from the previous session, trading at $4,849.30 per ounce. At the same time, silver prices surged 10.71% to $86.95. On January 30, gold and silver prices had plunged by 11.39% and 31.37%, respectively, but staged a strong rebound within a single trading day.
The sudden increase in volatility is attributed to expectations that Warsh will find it difficult to pursue a tightening policy. Although Warsh supported tightening measures as a Fed Governor during the 2008 global financial crisis, there is now a strong expectation that he will align with President Trump’s rate-cutting agenda. On January 31 (local time), President Trump stated of Warsh, “He will never disappoint,” and controversially added, “If Warsh doesn’t cut rates, I’ll sue him.”
Krishna Guha, Vice Chairman of the major U.S. investment advisory firm Evercore ISI, told CNBC, “It is not advisable to simply assume that Warsh will take a hawkish (tightening) stance and follow that strategy too closely.” He added, “Warsh is regarded more as a pragmatist than an ideological hawk, so he is likely to use a variety of policy tools. There is a risk of sharp price swings in asset markets depending on changes in U.S. policy.”
◆Crypto Market Extends Losses... 'Digital Gold' Status in Jeopardy
In contrast to the rebound in safe-haven assets such as gold and silver, the decline in the cryptocurrency market is deepening. This is analyzed as a result of investors rapidly reducing their exposure amid growing market uncertainty.
According to global cryptocurrency tracking site CoinMarketCap, as of 9:30 a.m. on February 2, 2026, Bitcoin was trading at $77,866.73, down 1.45% from the previous day. Other major cryptocurrencies by market capitalization, including Ethereum, BNB, Ripple (XRP), and Solana, were also down between 2% and 5%.
Investor sentiment has been negatively affected by both the uncertainty surrounding U.S. monetary policy and the recent escalation of tensions in the Middle East. John Todaro, an analyst at U.S. investment bank Needham, told Bloomberg, “Current indicators show that retail investor interest is at an extremely low level,” adding, “This trend of declining trading volume could continue for another one or two quarters.”
Ilan Solot, Global Markets Chief Strategist at Marex Solutions, a financial services platform, also told the Financial Times (FT), “In the case of Bitcoin, it is an asset for which there is currently no clear valuation model,” and pointed out, “There is no consensus on what should determine its price.”
◆Obstacles Emerge for Warsh’s Senate Confirmation... 'Tillis' Becomes a Key Variable
However, there are concerns that Warsh may face difficulties in securing actual Senate confirmation. If the confirmation process is delayed, market anxiety could intensify further.
According to Reuters, the U.S. Senate Banking Committee currently has a narrow Republican majority, with Republicans holding 13 seats to Democrats’ 11. If any Republicans defect, the confirmation could face hurdles before reaching the full Senate. In the Senate as a whole, Republicans maintain a majority by just three seats. Amid this, Senator Thom Tillis (Republican), a member of the Senate Banking Committee, is likely to vote against Warsh’s confirmation.
Senator Tillis, who has clashed with President Trump over certain legislative issues, stated on the day Warsh’s nomination was announced, “I will block the confirmation until the Justice Department’s investigation into Chair Powell is completed transparently.” In response, President Trump retorted, “That’s why he’s no longer a senator.” Although Senator Tillis has announced he will not seek re-election this year, he will remain in office until early next year.
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