SEATTLE (Scrap Monster): The World Gold Council (WGC) published a new report that highlights recent moves in gold.
According to John Reade, Chief Market Strategist, WGC, gold prices have declined by more than $100 per Oz over the past one month, with most of the decline happening over two days during the previous week. After a quiet trade in the range of $1,810 per Oz, the prices fell to $1,770 per Oz on Tuesday and to $1,740 per Oz on Wednesday.
The downward price movement was triggered by two major factors. In the first place, the U.S. dollar strengthened sharply during the week, driven by economic weakness in Europe and weakness in Japanese currency. Secondly, the general weakness in industrial commodities too contributed to weakness in gold.
In addition to the above, the gold price movement was seen tightly correlated with crude oil price movements. The broad-based commodity index selling has also contributed to weakness in gold. The investors are seen cutting exposure across all commodities, WGC report said.
The aggressive acts by the U.S. Fed, when compared to other central banks, have supported dollar. The high inflation on account of surging energy prices have led to central banks in Europe and the UK to remain cautious on hiking interest rates.