Recently, the price of gold took a big dip—the price dropped to $1,750, the lowest it’s been since April 16th. Compared to gold, the US dollar seems to be getting stronger. The recent release shows some positive news. The job market is recovering all over the world. The pandemic brought by COVID-19 is cooling down. Vaccinations are also working pretty well.
As a hedge against inflation, the price of gold goes down. Will it mean that the inflation situation passes? “The calls for interest rates to trend higher are going to be much louder from the Fed if we do get a better-than-expected jobs number,” weighing on gold, said Bob Haberkorn, senior market strategist at RJO Futures. The expected number of jobs is 690,000, which is much higher than the number of May.
According to the chief market analyst at Exinity Group, the hike of U.S. interest rates is sooner than we expect. Also, the preceding taper should add more pressure to the price of gold. The price of gold could potentially drop to $1,730 or even worse below $1,700.
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