GOLD - the decline has not stopped

Gold prices experienced unpredictable fluctuations following US Federal Reserve Chairman Jerome Powell's recent statement to the House Financial Services Committee. Powell indicated that while interest rates are no longer a significant factor, they will continue to rise moderately to combat deep-rooted inflation.

The US Dollar Index, which measures the volatility of the US dollar against major currencies, dropped by 0.46% (to approximately 102 points). As a result, both the US and European stock markets are currently performing poorly. Investors in the stock market are diverting some of their capital into US bonds, leading to an inflow of money into precious metals. Consequently, the price of gold is facing downward pressure today.

Based on the expectations of most Federal Reserve officials, if no changes occur, the Fed will likely raise interest rates twice more for the remainder of 2023. This anticipated scenario suggests that the US dollar will remain strong, negatively impacting the value of gold.

Comment:

The longer gold trades sideways without fresh impetus, the greater the risk of a deeper sell-off.

Comment:

The strength of the dollar, as measured by the Dollar-Index against a basket of six major currencies, has increased by 0.39% compared to yesterday morning, reaching 102.6 points.