A few months ago, traders expected the price of gold to soar to $2,000 an ounce, because they expected that the quantitative easing policies implemented by major central banks around the world would stimulate consumption and raise asset prices and gold prices. Gold has always been regarded as a tool to hedge inflation.
Tom, a commodities analyst at UBS, said that all this has not been realized and the price of gold has fallen. In the process of deleveraging, it is better to accept cash and repay debts than to consume, which is a bearish signal.
A strong dollar usually means a fall in the price of gold. When the dollar strengthens, gold futures traded in dollars become more expensive for investors who use other currencies.
Analysts said that in the next few months, there is limited room for gold to rise, because inflation expectations are dim and global stock market risk aversion is rising.
As investors wait and see, they may sell gold exchange traded funds, which will further depress the price of gold.
Standard & Poor's Depositary Receipts Gold Fund has more gold reserves than the Bank of France. If investors decide to quit, physical selling will further affect the price of gold.
Analysts said that with the prosperity of the global gold consumption market, India will increase its gold supply, but this will not have a lasting impact.
In India, it is traditionally used for weddings and religious occasions, especially in June 5438+ 10 and June 165438+ 10.
Holiday consumption in India is the main driving force of gold price.