KGHM stock prices fell as precious metals plummeted following Trump’s nomination of Kevin Warsh as Fed chairman.
Precious Metals Market Correction
The decline in KGHM stock prices reflects a sharp raw material market correction that particularly affected precious metals. Gold recorded an 11% drop on Friday, the largest one-day decline in history, and continued its decline on Monday. Silver, after plummeting more than 30%, also continued to fall on the first session of the new week.
Trump’s Fed Nomination
The avalanche of precious metal sales was triggered by Donald Trump’s decision to nominate Kevin Warsh as the next Fed chairman. If the Senate confirms the nomination, in mid-May, the Stanford University lecturer and Fed Board member from 2006-2011 will replace Jerome Powell on the position.
Dollar Strengthens
Experts believe that from among the candidates, Trump chose the one who guarantees monetary policy stability and is least inclined to cut interest rates. After Warsh’s nomination, the dollar strengthened sharply – the euro exchange rate fell from over $1.2 on Thursday to $1.182 on Monday.
