Gold retreats below key threshold in Uzbekistan following global correction

According to the Central Bank of Uzbekistan, on Monday, 2 February, the price of a five-gram gold bar fell to UZS 9.867 million, down by UZS 908,000 compared with Friday. The price of one gram of gold declined to UZS 1,973,470, a decrease of UZS 183,480, or 8.5 percent.

Just a week earlier, on 26 January, the price of a five-gram gold bar in Uzbekistan had surpassed the psychological threshold of UZS 10 million for the first time. Prices continued to set new records for three consecutive days before easing slightly on Friday, when the five-gram bar was priced at UZS 10.785 million.

The decline reflects a sharp correction in global gold prices over recent days. Spot gold is currently trading at around $4,679 per troy ounce, equivalent to approximately $150.44 per gram. This represents a drop of more than 15 percent from the record high of $5,550 reached on 29 January.

The sell-off began on 30 January, when gold prices fell by 7 percent in a single day to about $5,000 per troy ounce. Other precious metals also recorded significant losses that day: silver and platinum dropped by around 18 percent to $2,170 and $95 respectively, while palladium fell by more than 14 percent to $1,720.

Market analysts attribute the sharp decline to a combination of technical overheating after several weeks of rapid price growth and a shift in investor expectations. The immediate trigger for the sell-off was a statement by former US president Donald Trump announcing plans to replace the head of the US Federal Reserve.

Trump said he intends to nominate Kevin Warsh, a lecturer at Stanford Graduate School of Business, to succeed current Federal Reserve Chair Jerome Powell. Warsh served as a member of the Federal Reserve Board from 2006 to 2011 and previously worked as a special assistant to President George W. Bush on economic policy.

Warsh is widely regarded as an advocate of relatively strict anti-inflation policies and a reduction in the size of the Federal Reserve’s balance sheet. Investors expect that such a policy shift could lead to a strengthening of the US dollar, reducing the appeal of gold and other precious metals as safe-haven assets.