© Archyde.com. Gold continues its losses despite the decline in the dollar index
Arabictrader.com – Spot and spot prices declined significantly during trading on Tuesday morning, and for the second consecutive day, to record noticeable declines, which came amid anticipation of the results of the new round of negotiations between Russia and its neighbor Ukraine, which started today.
This was also launched by US President Joe Biden, the new US budget proposals, yesterday evening, which affected the movements of the US dollar and therefore gold, as the green currency is linked with gold in an inverse relationship.
It rose to its highest level in more than a week, making gold more expensive for holders of other currencies. The US dollar has benefited from its safe haven status in light of the conflict in Ukraine, amid expectations that the US Federal Reserve will raise interest rates several times this year.
The process of raising interest rates on gold affects the attractiveness of holding it against other commodities, because higher interest rates support the US dollar, against the risks of inflation and price increases.
This is with the continued rise in US treasury bond yields, influenced by the expectations of raising interest rates in the United States strongly during the current year to counter inflation, bringing 10-year yields to about 2.509, a rise of approximately 1.28%.
Accordingly, gold prices recorded in trading this morning, with the opening of the week, a bearish performance, as gold prices fell in spot transactions by about 1.50%, or approximately 1,910.70 dollars, and gold futures contracts in the United States decreased, reaching about 0.57%, or 1,911.82 dollars. Roughly, according to Archyde.com news agency.
While it may rise at any time, if the new round of negotiations between Russia and its neighbor Ukraine does not produce bad results that threaten the global economy, as investors resort to gold in such situations to hedge against economic risks.
It should be noted that there are two basic rules governing gold prices around the world, the first is the factor of supply and demand, and the second is the changes that occur in the price of the US dollar currency. The price of the US dollar decreased as the price of gold increased.
Finally, as for today’s trading in metals other than gold, the price of spot transactions fell by 1.92% to $24.712 per ounce, and the price decreased by 0.14% to $4.7190 per ounce.
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