Gold Price Continues To Decline
By Daisy Joseph
The gold prices almost always travel in a direction opposite to the US dollar.
As the dollar strengthens in the market, the gold price declines automatically. On Thursday, the gold price rose slightly during the European trading hours. However, the slight increase is not sufficient to offset the previous losses. For the past eight weeks, the gold price has been declining and there is no sign of recovery any time soon.
The expectations for an interest rate hike in June continue to increase. The Fed has indicated that it will increase the interest rate in June. As a result, the Comex gold futures increased by 0.3% to reach $1222.60 per ounce. The spot gold was trading at $1222.30. The gold price reached its lowest value of $1214.30 on March 15th. The safe haven assets lost their importance as the major global currencies such as USD and EUR continued to gain dominance in the market.
The Fed Rate Monitor Tool has reported that the market pricing has reached 80% chance of an interest rate hike in the next month. The increasing US interest rates has a direct impact on gold pricing. Boosting dollar is never a good sign for the yellow metal. The dollar index reached 99.46 which is much closer to a three-week high of 99.61. The 10-year treasury bonds also reached 2.395% which is closer to a previous peak value of 2.416%.
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