Gold rebound expected

THE World Gold Council says that gold’s fall to a 20-month low was due to the sharp emerging market currency depreciation – but, at current levels, the organisation believes that the price may bounce back.

  • Staff Reporter
  • 31 August 2018
  • 04:49
  • News
Gold rebound expected

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"The gold price lost 3% in August, a downturn that was exacerbated by gold's fall below $1200 an ounce - an important technical support level - for the first time since early 2017," the WGC said. 
 
The WGC says gold was propelled down by the strength of the US dollar against both developed and emerging market currencies, particularly, a weakening of the Chinese yuan first and Turkish lira later.
 
"In fact, the dollar's strength has been one of the most important drivers of gold's performance this year as confrontational trade rhetoric and sanctions have so far played in favour of the US."
 
Overnight, the gold price was fixed at $1197.49 per ounce.
 
The WTI crude oil price was slightly down overnight at $70.14 per barrel.
 
In softer commodities, cocoa decreased $74 per tonne or 3.17% to $2262/t yesterday from the $2336 in the previous trading session, tradingeconomics.com reported. Historically, cocoa reached an all-time high of $4361.58/t in July of 1977 and a record low of $211/t in July of 1965.
 
Coffee decreased 0.30c per pound or 0.30% to 98.5c/lb yesterday from 98.65c/lb in the previous trading session, tradingeconomics.com reported. Historically, coffee reached an all-time high of 339.86c/lb in April of 1977 and a record low of 42.50c/lb in October of 2001.

 

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