Gold's fall continues on resurgent US dollar and buoyant yields
economictimes.indiatimes.com
The US Dollar Index rallied for the eighth consecutive week, which is its longest winning streak since 2005. The Greenback gained as the US economy is presently doing better than its peers, especially the European economies.
The Euro-zone and the UK economies are grappling with a grim possibility of stagflation as these economies are slowing down amid high inflation, thus the Bank of England and the European Central Bank face a tough task of bringing inflation down without high interest rates causing further damage to these economies. US ISM manufacturing (August), ISM manufacturing prices paid, initial jobless claims, ISM services and ISM services data were better than forecasts and showed improvement over their respective previous readings.
On the other hand, the Euro-zone's 2Q GDP (final) reading was revised lower to 0.10% from the previous estimate of 0.30%; even the y-o-y reading at 0.50% trailed the estimate of 0.60%.
Similarly, Japan's 2Q (final) GDP was revised lower from 1.50% to 1.30% Vs the forecast of 1.20%.
High oil prices and the ailing Chinese economy are other major factors supporting the US Dollar Index in the present scenario. In a notable development, the Chinese Yuan has fallen to an all-time low against the US Dollar.
Spot gold closed the week ending September 8 with a weekly loss of 1% as it closed at $1919.
