Gold’s decline continued unabated on Monday, marking the sixth consecutivesession of losses and bringing the precious metal to a nearly seven-monthlow. This downward trend was primarily driven by the strength of the U.S.dollar and the growing anticipation of higher interest rates in the UnitedStates, both of which dimmed the appeal of gold as an investment.
As of 9:54 a.m. EDT (1354 GMT), spot gold had dropped by 0.8% to reach$1,835.40 per ounce, a level not seen since March 10. Simultaneously, U.S.gold futures also saw a decline of 0.7%, settling at $1,853.00. Theconsensus among market experts is that this decline is largely attributedto the prevailing sentiment that interest rates in the U.S. will remainelevated for an extended period, which has cast a bearish shadow over theprecious metal market. Some analysts even predict that gold prices coulddip below the $1,800 mark in the short term.
Jim Wyckoff, a senior analyst at Kitco Metals, echoed this sentiment bystating, “There is a reckoning that interest rates are going to be higherfor much longer, which has been the bearish element in the precious market.Gold prices could go below $1,800 in the near-term.”
Additionally, he pointed out that currency market trends tend to be robustand enduring, suggesting that the appreciation of the U.S. dollar may persist, further exerting downward pressure on the gold market.In fact, the U.S. dollar index rose by 0.4% during this period, making goldless appealing to investors holding other currencies.
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In summary, the continuous decline in gold prices, extending for the sixthconsecutive session, can be attributed to the strength of the U.S. dollarand the expectations of higher interest rates in the United States. Thesefactors have diminished the allure of gold as an investment, with spot goldhitting its lowest level in nearly seven months at $1,835.40 per ounce.Analysts, such as Jim Wyckoff from Kitco Metals, believe that the bearishsentiment surrounding gold may persist, potentially leading to pricesfalling below the $1,800 mark in the near term. The appreciation of theU.S. dollar, as reflected by a 0.4% increase in the U.S. dollar index, hasfurther contributed to gold’s recent struggles in the market.
