Gold News: Dollar Strength Causes Two Month Low For Gold

Gold News

In the latest gold news: As of October 2 at 12:41pm EST, gold was trading at $1275.57 per ounce, dropping comparatively to previous steady prices above $1300. At approximately this time last week, gold was trading at $1308.73 per ounce.

gold news

Recently, gold prices have remained relatively stable and high due to political tensions and fear in the market leading to investors seeking safety in the bullion. However, gold is still heavily dependent on the dollar, and increases in dollar prices have not only tempered gold prices, but also put strong pressure on a downward momentum. This is in light of several factors. There is much speculation that the U.S. is in talks with North Korea after President Trump’s tweet that talks should not continue since they are a waste of time. Despite the President’s negative take on possible peace discussions, the possibility of their existence in the first place has led the market to feel more at ease and not pursue gold as aggressively. This alone, however, would not be a strong enough factor to drive such a drastic change in gold. The primary movement comes from recent dollar news. The dollar has been gaining strength primarily due to expectations that the Fed will raise interest rates again in December. This is a result of the Fed chair Janet Yellen stating that the central bank plans to stay on its current rate hike path. These higher interest rates will boost the dollar and push bond yields up, which will in turn drag gold down.

Several investment institutions have reduced their position in gold as a result. Although this immediate response is still based on future news, investors should keep an eye out for when these interest rate hikes are implemented, as there is strong evidence that a third one will occur before the end of the year and that there are three more planned for next year. Hence, this will directly affect the price of gold through the movement of the dollar.

This sentiment remains prevalent and is causing the bullion to dip. In the 90-day gold prediction ending September 16, I Know First’s algorithm based on a stock prediction algorithm showed an impressive 100% accuracy rate, as seen in “Gold Price Predictions Based on Deep Learning: Returns up to 5.24% in 3 Months.” After a month, I Know First’s average percent change came out to 5.22% with XAU as the top earner, bringing in an impressive 5.24% return to investors.


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