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Gold is driven by IMF and weakening dollar

Olymp Trade

Gold rose again impulsively and updated the local maximum near $1430/oz. This is slightly higher than the local maximum of July 11, when a similar sharp increase of metal price was recorded. Growth was caused by a falling dollar, the DXY index lost 0.4% over the same period. Nevertheless, buyers could not raise the price up to 6-year high, near $ 1440, and a correction began, which can return quotes down to the level of $ 1410 in the short term.

Dollar movement and as a result gold increasing was caused by the statements of the IMF, in which they claim that the US currency is overvalued by 6-12%, based on short-term economic indicators. A cheaper dollar makes assets whose value is expressed in dollars cheaper for buyers from other countries.

Additional support for gold comes from concerns about the US-China trade negotiations. Donald Trump said earlier this week that there is a long way to go before Washington and Beijing can make a trade deal, and also threatened to introduce additional tariffs on Chinese goods.

Olymp Trade Review

Source: https://olymptrade.com/
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