Yesterday, President Donald Trump’s eldest son released an email chain which suggests that Russia wanted to support Trump’s presidential campaign. What does it imply for the gold market?

What a twist! Ahead of the surprise dump, gold was in a downward trend. And after the release, it jumped about $8 in minutes, as one can see in the chart below. In this way gold confirmed its safe-haven status.

Chart 1: Gold prices over the last three days.

Indeed, financial markets were jarred by the sudden disclosure. The S&P 500 Index decreased about 0.6 percent in minutes, while the U.S. dollar depreciated against the Japanese yen, as the chart below shows.

Chart 2: S&P 500 Index over the three last days.

Chart 3: USD/JPY exchange rate over the three last days.

Investors are afraid that the surprise release may add to the political turmoil in Washington D.C. Some analysts even speculate that Trump Jr.’s behavior could lead to criminal liability and could weakened the President’s position and his ability to enact a pro-growth agenda. The most controversial passage from the email chain comes from the June 3, 2016, email to Donald Trump Jr. from publicist Rob Goldstone:

“The Crown prosecutor of Russia (…) offered to provide the Trump campaign with some official documents and information that would incriminate Hillary and her dealings with Russia and would be very useful to your father. This is obviously very high level and sensitive information but is part of Russia and its government’s support for Mr. Trump”

And Trump Jr. replied “if it’s what you say I love it”. Hence, for us, the whole story is a bit overblown, as there is no evidence that the President’ eldest son received any information from the Russian government. Perhaps he should not have taken this meeting, but taking meetings is not illegal, even with foreigners, as far as we know. Anyway, a serious investigation is needed to discover what really happened.