The gold is at approximately two-week bottom after yesterday’s
depreciation by 2% when positive data came out from USA and increased
expectations that the Federal Reserve will raise interest rates this year.
The dollar also held large profits after the rally
that led to the biggest daily decline of gold after 30 April. The spot price is
1188 dollars, and yesterday it bottomed 1185.35 dollars per troy ounce and the
lowest value after the 12th.
Yesterday it became clear that business investment
in the US rose in April for the second consecutive month, while consumer
confidence has reported a rise this month. This increase alerts that economic
growth has gained momentum after slowing in the first quarter. Sales of new properties
in USA also rose last month.
The strong data are synchronized with the speech of
Fed Chairman Janet Yellen last week that the central bank is confident in the
rise in interest rates this year. Her comments led to a rally in the US
currency and an eight-year high against the yen and the strong rise against the
euro. This made dollar-denominated assets like gold more expensive for buyers
using other currencies.
According to some analysts, the market prematurely
calculated secure economic recovery and this can be refuted on Friday, when the
GDP for the first quarter may be revised to a drop compared to the original
estimate of growth of 0.2%.
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