On the global market, a further decline in gold prices was recorded on January 16. The main factors for the drop were better-than-expected economic results from the U.S. and the stabilization of the situation in Iran.
This is reported by Finway
Strong Dollar and Geopolitical Impact
The spot price of gold fell by 0.3%, dropping to $4,603 per ounce. Meanwhile, last week the price reached a record level of $4,642 per ounce. Experts predict that despite the current trend, the price of gold may rise by approximately 2% over the week.
“The gold market has lost momentum in recent days… economic news from the U.S. is currently supporting the dollar more than gold,” explained one analyst.
U.S. Dollar Nears Peak, Demand for Gold Weakens
Following the release of statistics showing a decrease in jobless claims to 198,000, significantly lower than the projected 215,000, the U.S. dollar remained near a six-week high. The strengthening of the American currency traditionally makes it more difficult for foreign investors to purchase gold, as it becomes more expensive when converted to other currencies.
Additionally, the reduction of tensions in Iran has led to a decrease in demand for gold as a safe-haven asset. In India, low demand for gold was recorded this week due to high prices, while in China, demand remained stable ahead of the Lunar New Year celebrations.