Why are gold prices falling now?
Gold prices are witnessing live action in the global market after the
release of Delta Montaner's Liberty data, as they fluctuate between rise
and fall and try to stabilize above the level of $2,000 per ounce, which
is considered a psychological protocol for the precious metal.
Gold and US data
Gold prices greatly influenced the recently released US economic data,
which has become a situation among the world's major economies considering
the Corona crisis and fiscal and monetary stimulus policies.
Among its partners who collect data are:
- Existing real estate sales: Ranged to the high end of their 13-year ranges in October, as rising mortgage costs and tight inventory drove market construction.
- Minutes of the monetary policy meeting: showed that the responsibility of the US central bank is not expected to raise interest rates cautiously, depending on market conditions and diversity.
- The US dollar: rose after recording its lowest levels in Activation, which increased the cost of the other gold welding indicators.
Gold
prices fell by 0.11% to $1,999 per ounce in futures contracts, and by 0.06%
to $1,997 in spot contracts, according to Saudi Investing data.
Gold and $2000
Despite the current decline, gold prices are still challenging the level of
$2,000 per ounce, which it exceeded for the first time in its history last
August, supported by several factors, including:
- Global demand for safe havens considering the economic and political uncertainty resulting from the Corona pandemic and trade and geopolitical tensions.
- The easy monetary policies of major central banks, which aim to support growth and inflation, and which reduce government bond yields and the opportunity cost of holding gold.
- A weak US dollar, which makes gold cheaper for holders of other currencies, and increases demand for the metal as a means of maintaining value.
Matt Simpson, chief analyst at City Index, said, “Gold benefits from the
decline in revenues and the dollar, thanks to weak American economic data
that supports expectations of an interest rate cut from the Federal Reserve
in 2024,” adding that “gold needs strong foundations to stay above $2,000,
otherwise it may witness... A downward correction.
Gold prices rose at the settlement of trading yesterday, Tuesday, by 1.1%
to $2,001.6 per ounce, which is the highest level at the end of the session
since October 30, after touching $2,009.80.
other metals
Regarding other precious metals, they also witnessed similar fluctuations
to
gold, as:
- Silver rose in spot transactions by 0.3% to $23.79 per ounce.
- The price of platinum stabilized at $931.34 per ounce.
- Palladium fell by 0.6% to $1,072.35 per ounce.
The prices of these metals are affected by the general factors that affect
gold, in addition to factors specific to each of them, such as supply and
demand, industrial use, and jewelry.
Market experts expect that prices of precious metals will continue to
fluctuate in the coming period, with markets awaiting more economic and
political data that may determine the course of the global economy, monetary
policy, and the dollar.
