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    07.07.2016 15:33 Gold price declined

    07.07.2016 15:33

    The cost of gold has decreased from the highest level since March 2014, which was due to the strengthening of the dollar against the backdrop of the US employment statistics. However, a further decline in prices constrain concerns about the effects of Brexit.

    Financial markets remain highly volatile after results of the referendum provoked a collapse of stocks, bonds reduced the yield to a record low, as well as increased demand for safe-haven assets such as gold and silver. Yesterday the spot price of gold toucked the high of March 2014, but there was no follow through ​due to rise of stocks and the US dollar.

    Mitsubishi analyst Jonathan Butler said while the strong dollar is a "headwind" for gold, there are good opportunities for further rally of the precious metal. "I believe that gold can go up to $ 1381 or even higher than the psychological level of $ 1,400"

    One of the reasons for today's strengthening of the US dollar was ADP data, which showed that employment growth in the private sector accelerated in June, and was higher than forecast. According to the report, the number of employees increased by 172K. It was expected that the number of employees to increase by 159 thousand.

    Investors are also awaiting the publication of Friday's employment report in the US non-farm sector, which could affect the prospects of US monetary policy. Adverse findings reinforce the view that the Fed has little reason to raise interest rates this year. Until recently, it had been widely expected that the Fed will raise rates at some point this summer. Nevertheless, given Brexit and US data, investors are now skeptical about that.

     

    The cost of the August gold futures on the COMEX fell to $ 1358.4 per ounce.

     

     


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