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June 30, 2021

USD Crime, Gold Falling Down!

 Gold traded steady in the Asian session after plunging to a two -month low in the previous session driven by strong US dollar trading.

Spot gold rebounded to around $ 1,761 an ounce, after falling to its lowest level since April at $ 1,750 an ounce. Gold futures traded at $ 1,763 an ounce.

Gold prices are now on track to post their worst monthly loss since November 2016, after being driven by the Federal Reserve’s (Fed) hawkish -toned monetary policy announcement.

Meanwhile in a recent statement, Fed Governor Christopher Waller said he was very optimistic about the economy and the central bank should reduce asset purchases as soon as possible this year before raising interest rates next year.

This statement has prompted the greenback dollar to continue to trade stronger against major currencies as well as supported by current sentiment in the market which is worried about the increase in the spread of Covid-19.

The strengthening of the US dollar was also supported by US consumer confidence data which jumped to a 16 -month high in June following growing labor market optimism amid economic reopening.