A precious metals future is a safe haven option for investors where they can put money in times of high volatility and uncertainty in the market. This goes to show that falling gold prices are affected as the market stabilize as fears from Brexit and Trump fade.
Market concerns over the Brexit from the European Union and the new U.S. president have calmed since last year, resulting to the Gold prices falling to as low as $1,226 from its high prices of $1,300 last summer and in November.
Experts say that the rising U.S. interest rates with the strong performance of the USD is the main cause why the value of gold is being pressed further in lower positions. Analysts are expecting the value of gold to be further pushed in the bull in the coming months.
The U.S. Federal Reserve is widely expected to raise interest rates once again next month, which will raise the value of the Dollar making the metal more expensive for investors.
Political worries flare up against any subsequent increase in gold values could be short-lived, as the long-term trend for the metal is down.
"With Gold potentially finding itself dictated by US rate hike expectations, further downside should be expected as the Federal Reserve maintains a hawkish stance." This was stated by Fawad Razaqzada, the market analyst at Forex.com. He added that “At the moment, it appears more likely that gold will stage a deeper retracement in its current bearish cycle."