Gold Prices Predicted To Reach New Lows
Last week saw the price of gold continue to fall as the dollar continued to gain. On Wednesday it took a dive from 1,237.60 to 1,223.00 and on Thursday continued falling to 1,218.10. It continued its downwards movement and on Monday morning was trading at 1,212.60.
Interest in the metal fell as expectations for higher US interest rates grew. Gold costs money to store and can’t really compete with yield-bearing assets when interest rates are on the rise. Furthermore, the dollar is trading at a six year high which makes gold considerably more expensive to holders of other currencies.
There is no sign of the dollar loosing strength and with the Federal Reserve due to end its bond-buying program next month the dollar may grow even stronger. As a result it is safe to assume that the price of gold will continue to fall.