Gold and silver prices surged to fresh record levels on Monday as investors reacted to reports that the US Justice Department is probing the Federal Reserve, raising concerns over the independence of the country’s central bank.
Gold climbed 1.6% to nearly $4,600 per ounce, while silver rallied toward $85 per ounce, with both metals setting new all-time highs. The gains reflected a sharp move into safe-haven assets as uncertainty rippled through global markets.
The US dollar weakened following the developments, slipping about 0.2% against major currencies, according to Bloomberg.
Federal Reserve Chair Jerome Powell confirmed the “unprecedented” nature of the probe late Sunday and criticised it as part of pressure from US President Donald Trump for further interest rate cuts. Powell said the Fed had received grand jury subpoenas on Friday related to his June Senate testimony, which focused on a major renovation of Federal Reserve office buildings.
“The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President,” Powell said in a statement.
Gold and silver SURGE TO A RECORD HIGH on heightened geopolitical uncertainties and a criminal probe into Federal Reserve Chair Jerome Powell pic.twitter.com/nDjPXHLcQY
— RT (@RT_com) January 12, 2026The Federal Reserve has already signalled that it intends to keep interest rates unchanged at its closely watched policy meeting later this month, reinforcing market expectations of a pause.
Market analysts said the probe has unsettled investors less because of the legal risk and more because of the political implications. Stephen Innes said the subpoenas represent a clear break from the long-standing separation between politics and monetary policy, a line markets once viewed as untouchable.
“Investors are not weighing the odds of charges so much as the risk that political pressure has crept into the Fed’s decision-making,” Innes said.
Echoing that view, Ray Attrill, head of FX strategy at National Australia Bank, said Powell appeared to be pushing back forcefully after months of criticism. He warned that the open confrontation between the Fed and the US administration is weighing on confidence in the dollar.
Video message from Federal Reserve Chair Jerome H. Powell: https://t.co/5dfrkByGyX pic.twitter.com/O4ecNaYaGH
— Federal Reserve (@federalreserve) January 12, 2026Earlier in Asian trading, the dollar reached a one-month high after strong US jobs data reinforced expectations that rates would remain on hold. However, the mood shifted as concerns over the Fed probe, combined with heightened geopolitical tensions, including unrest in Iran, fueled demand for safe-haven assets.
Investors are now bracing for a busy week of economic data. Key among the releases is the US consumer price index on Tuesday, one of the final major inflation readings ahead of the Fed’s January policy meeting.
Analysts at Standard Chartered said US inflation remains above the Fed’s 2% target, limiting the scope for further rate cuts unless economic momentum weakens sharply. They added that a resilient labour market could continue to place upward pressure on US Treasury yields and the dollar.
Beyond economic data, markets are also watching the start of the fourth-quarter earnings season, with major banks set to report results. Investor sentiment could also be influenced by a potential US Supreme Court ruling on the legality of Trump’s emergency tariffs, which may come as early as Wednesday.
