Treasury Secretary Scott Bessent cited Chinese traders as the reason behind last week’s wild swings in the gold market.

“The gold movement thing — things are getting a little out of hand in China,” Bessent said Fox news’Sunday Morning Futures. “They have to tighten margin requirements. So gold looks to me like a classical, speculative explosion.”

Bessent was responding to a question about a record-breaking rally in precious metals — fueled by speculative buying, geopolitical turmoil and concerns about the independence of the Federal Reserve — that suddenly reversed last week.

The turmoil helped lift the dollar to thisfirst week profitsince early January while the Dow The Jones Industrial Average topped 50,000 for the first time, reflecting investor optimism about the US economy and corporate earnings.

With the midterm elections coming up in November, Bessent cited the record Dow Jones as evidence that the US economy is headed for an upward cycle that will benefit ordinary Americans.

On Federal Reserve policy, Bessent said he expects the central bank to act cautiously in any effort to trim its balance sheet.

“I don’t expect them to do anything quickly,” he said. “They moved to the policy of the sufficient regime, and that requires a greater balance, so I think they will probably sit, at least a year to decide what they want to do.”

President Donald Trump’s nominee to be the next chairman of the Federal Reserve, Kevin Warsh, “will be very independent, but mindful that the Fed is accountable to the American people,” Bessent said.

During a Senate hearing Thursday, Bessent told lawmakers that Trump is up to suing Warsh if he fails to lower interest rates as Trump wants.

Pressed by Senator Elizabeth Warren, Bessent said the comment stemmed from a joke Trump made, defended Warsh’s qualifications and emphasized Trump’s expectation that the Fed nominee aligns with his views on interest rates.

This story was originally featured on Fortune.com

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