Gold is having great difficulty against USD
The global gold market continues to trade at its lowest level in five months as bond yields continue to rise following the release of the Federal Reserve's July monetary policy meeting minutes.
The increase in bond yields has raised the opportunity cost of holding non-interest-bearing assets like gold, while the recovery of the US dollar has taken away some of the appeal for buyers holding other currencies. These two headwinds have pushed gold to its lowest level in five months.
In addition, China's central bank recently unexpectedly lowered key interest rates by their largest decrease since 2020, in an effort to revive an economy facing risks from all sides, from a real estate market immersed in crisis to weakening consumer demand. Meanwhile, a series of reports indicate that China's economic growth is slowing down. This has increased concerns that future demand for gold will be weaker, creating resistance for investors looking for higher prices for this precious metal...
The increase in bond yields has raised the opportunity cost of holding non-interest-bearing assets like gold, while the recovery of the US dollar has taken away some of the appeal for buyers holding other currencies. These two headwinds have pushed gold to its lowest level in five months.
In addition, China's central bank recently unexpectedly lowered key interest rates by their largest decrease since 2020, in an effort to revive an economy facing risks from all sides, from a real estate market immersed in crisis to weakening consumer demand. Meanwhile, a series of reports indicate that China's economic growth is slowing down. This has increased concerns that future demand for gold will be weaker, creating resistance for investors looking for higher prices for this precious metal...
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Most members of the Fed's Federal Open Committee of Mayors (FOMC) worry the war on usage is far from over, the minutes of the newly released meeting show. They emphasized that the FOMC can continue to tighten monetary policy.
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Financial investors are gradually shifting their capital from safe-haven assets like gold towards investments in production and business sectors or other profitable assets. As a result, gold has lost its prominence in the market.
