The gold price is trading slightly higher today as the market awaits the senate testimony later today from Jeremy Powell who is Donald Trump’s pick to be the next chairman of the US Federal Reserve.

In what may be a boost for gold, the next Fed president is expected to take a cautious approach on the question of interest rates and they may not be raised as fast or as higher as analysts predicted earlier,

"Powell’s decisions on rates are suggested to be almost indistinguishable from those of his predecessor, but I would not be surprised if in the next few months we see him taking a dovish path," saidActivTrades chief analyst Carlo Alberto de Casa .

"I don’t think he will push to raise rates too much, but will instead monitor US inflation and the job market." He added.

Golds next big test is coming towards the end of this week when the US senate convenes for a vote to adopt legislation on Donald Trump’s tax reform.

If the bill passes in its original state the gold price is expected to take a huge hit on the back of an expected rush towards the US dollar. If the measure fails to pass with the required number of votes or is changed before it passes, gold will benefit immensely and will finally break back up through the psychological $1,300 level.

"It will be keenly watched particularly the details of the cuts. There is a risk it could be slightly watered down than what was originally proposed by President Donald Trump," noted ANZ analyst Daniel Hynes.