He Price of the ounce of gold in euros falls for the third consecutive day on Monday, collapsing at its lowest price since last March 13.
On Friday, the Xau/EUR closed about 2,770.60, losing an important 1.68% in the day.
This week, the price of gold in euros has opened the Asian session with a strong decrease to 2,709.23, minimum of 25 daysalthough he has subsequently trying to bounce up, rising to a daily maximum in 2,789.05.
He XAU/EUR trades at this time about 2,760.45, losing 0.36% in what we have been.
From one year to this part, the price of gold in euros has risen 28.23%.
What factors have influenced the price of gold recently?
- According to FXSTERET market analyst, Haresh Menghanithe growing global commercial war continues to feed concerns about a worldwide economic recession and leads to a prolonged mass sale in shares markets worldwide. This, in turn, led the operators to liquidate their long positions around the price of gold and increase their liquidity to cover losses in other places.
- According to data published Monday, The Popular Bank of China (PBOC) added gold to its reserves for the fifth consecutive month in March. In fact, Banco Popular de China’s holdings increased by 0.09 million Troy ounces last month.
- The president of the United States, Donald Trump, imposed reciprocal tariffs of at least 10% to all imported goods at the end of last Wednesday, with China facing 34% of addictive taxes under this new regime. In response, the China Ministry of Commerce announced on Friday that they will impose added rates of 34% to all US imports.
- Meanwhile, the US Secretary of Commerce, Howard Lutnick, confirmed Sunday that tariffs will not be postponed and that the decision will remain in force for days and weeks. In addition, Trump declared that there will be no agreement with China unless the trade deficit is resolved.
- Israel has killed 53 Palestinians in Gaza since Sunday. In the early hours of Monday, an Air Ataqué of the Israeli army has killed two journalists who were camped along with eight more reporters next to the hospital Al Nasser, south of the strip.
- The US government has decided to exclude Russia from tariffs to try to facilitate a peace agreement with Ukraine. For its part, the Ukrainian government confirmed that it will send a delegation to Washington to negotiate the agreement on access to rare earth minerals between the two countries. Meanwhile, attack actions in Russian and Ukrainian territory continue.
FAQS GOLD
Gold has played a fundamental role in the history of mankind, since it has been widely used as a deposit of value and a half of exchange. At present, apart from its brightness and use for jewelry, precious metal is considered an active refuge, which means that it is considered a good investment in turbulent times. Gold is also considered a coverage against inflation and depreciation of currencies, since it does not depend on any specific issuer or government.
Central banks are the greatest gold holders. In their objective of supporting their currencies in turbulent times, central banks tend to diversify their reserves and buy gold to improve the perception of strength of the economy and currency. High gold reserves can be a source of trust for the solvency of a country. Central banks added 1,136 tons of gold worth 70,000 million to their reservations in 2022, according to data from the World Gold Council. It is the largest annual purchase since there are records. The central banks of emerging economies such as China, India and Türkiye are rapidly increasing their gold reserves.
Gold has a reverse correlation with the US dollar and US Treasury bonds, which are the main reserve and shelter assets. When the dollar depreciates, the price of gold tends to rise, which allows investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rebound in the stock market tends to weaken the price of gold, while mass sales in higher risk markets tend to favor precious metal.
The price of gold can move due to a wide range of factors. Geopolitical instability or fear of a deep recession can cause the price of gold to rise rapidly due to its condition of active refuge. As an asset without yield, the price of gold tends to rise when interest rates lower, while the money increases to the yellow metal. Even so, most movements depend on how the US dollar (USD) behaves, since the asset is quoted in dollars (Xau/USD). A strong dollar tends to keep the price of gold controlled, while a weakest dollar probably thrusts gold prices.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
