Gold price next week?
Gold price last week fell to the lowest level since the beginning of the year, anchored around a 2-month low, in the context of USD price still increasing and reaching the highest level since the beginning of 2017.
USD has been chosen by many investors as a safe haven amid volatility economy and world politics worries them. Especially the fact that the US Federal Reserve (FED) is expected to raise interest rates by 50 basis points at its meeting on May 3 – 4, which will make the USD price go up and make it difficult for the gold market.
The USD index has reached a 5-year high and at one point reached 103.82 – a level not seen since late 2002. A strong USD makes gold more expensive for buyers in other currencies, sometimes only only the number of USD rose to 103,382 points.
The possibility of further US interest rate hikes adds to the relative appeal of the USD against real assets like zero-yielding gold. Then, less dollars are needed to buy an ounce of gold, reducing the value of the non-ferrous metal.
In addition, the volatility of some strong foreign currencies is having a certain impact on the gold price. Specifically, the yen fell to a 20-year low after the Bank of Japan announced unlimited bond purchases, meaning cash in Japan would flood the market.
This causes the USD value to appreciate further against the Yen. Meanwhile, the euro has fallen to a five-year low and is almost at par with the value of the dollar (currently 1 euro for $1.04).
Under the pressure of USD, world gold price sometimes from 1,885 USD/ounce to 1,872 USD/ounce.
Notably, while gold fell to multi-week lows, investment funds around the world bought another 185 tons of gold, worth about $15 billion, in March. This is the highest monthly purchase since July/July. 2020. Therefore, although we have seen a shift in money flow to USD making it difficult for gold to recover, analysts still see solid support for the precious metal for the rest of the year.
In a report published earlier this week, Marc Desormeaux, senior economist at Scotiabank, said that despite a recent drop in gold prices of more than 5% from $2,000, he is still increasing his bullish forecast for gold. this precious metal. However, he also said that gold may face some difficulties next week before the Fed’s monetary policy decision.
In the end, gold is still supported by one factor such as: war in Ukraine, China’s economic slowdown, hot inflation and world stock market fluctuations.
Therefore, many opinions have predicted that the gold price will struggle next week and although it may decrease, there will be no ominous drop.
at Blogtuan.info – Source: vtc.vn – Read the original article here