Mei Ri Jing Ji Xin Wen·2026-01-31 06:22Core Viewpoint - The nomination of Kevin Warsh as the Federal Reserve Chairman by President Trump has triggered hawkish market expectations, leading to a panic sell-off in precious metals, with gold experiencing its largest drop in 40 years and silver hitting a historic intraday decline [1][3]. Group 1: Market Reactions - Gold prices fell over 12%, reaching a low of $4682 per ounce, marking the largest single-day drop since the early 1980s, and closed down 9.25% at $4880 per ounce [1]. - Silver saw a dramatic decline of over 36%, with an intraday low of $74.28 per ounce, ultimately closing down 26.42% at $85.259 per ounce [3]. - Domestic gold jewelry prices also plummeted, with major brands reporting significant price drops, such as Chow Sang Sang's gold price falling from 1708 RMB per gram to 1543 RMB per gram within two days [5]. Group 2: Market Sentiment and Trading Dynamics - The sharp decline in gold prices has led to a cautious market sentiment, with many traders and consumers adopting a wait-and-see approach, resulting in a significant drop in transaction volumes [7]. - Analysts attribute the sell-off to profit-taking pressures accumulated from previous gains, the announcement of the Fed Chairman, and the cascading effect of leveraged positions being liquidated [9]. - The market is currently trading based on "Warsh's hawkish expectations," which has contributed to a stabilization of the dollar and a subsequent decline in gold and silver prices [9]. Group 3: Trading Conditions and Regulations - Major precious metal exchanges have raised margin requirements for gold futures trading, increasing the financial pressure on high-leverage traders [10]. - The decline in precious metal prices has triggered a cycle of forced selling, where stop-loss orders are activated, leading to further price drops and additional margin calls [10]. - The legal framework surrounding gold purchases indicates that physical gold items generally do not qualify for a seven-day return policy, complicating consumer options in a volatile market [18].