Gold declined below the level of $1,800 an ounce, losing almost $40 when Powell announced a more aggressive reduction and more problematic inflation, which sounded more aggressive than before.
The Fed Chairman told the US Senate that the US Central Bank will consider the possibility of curtailing plans for several months before June.
Powell also said that it is best at this stage to abandon the term "inflation is temporary," adding that the risk of more stable inflation is growing.
In response to Powell's testimony, gold plummeted from a daily high of $1808.73 to a low of $1769.88, dropping by almost $40.
The head of the US regulator also touched upon the risks associated with the new Omicron variant, noting that it creates risks of declining employment, economic growth, and inflation.
The Fed chairman also said that the central bank's long-awaited discussion paper on the central bank's digital currency (CBDC) will be released in the coming weeks.
Meanwhile, Yellen testified with Powell and highlighted the problem of the debt limit, warning that inaction over time would lead to a deep recession. She also called December 15 the deadline for viewing and added that after this date, the Treasury will no longer have enough funds to continue financing the operations of the US government.