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The price of gold is expected to see a drop continue though it did see a bit of a rally here in early May. According to analysts at CNBC, gold’s current trajectory is still sliding steadily down and now isn’t the time to be buying they say, though it still is a great go to as a safe haven. They went over a chart that showed gold prices rising after the recession and hitting their high in 2011 of around $1,900. But in the years after that, it started slowly trending downward and reached its lowest point around the election of 2016. It regained traction in 2017 and into 2018, but it’s likely to come down yet again from its $1,300-1,400 level.
The good news about this is that the period of weakening appears to be over for the US dollar. Experts said it’s been “searching for a bottom” and now it’s already gone up by as much as 0.7℅ in just a couple days. There’s many reasons for this including the effects of President Trump’s tax cuts lowering the corporate tax rate and encouraging more economic activity. Foreign countries are more optimistic about investing in the US as well right now.
Another factor pointing towards gold’s decline is a strong bond market which is Point towards higher yields right now. Gold tends not to perform as strong when yields are doing well, and they’re looking to become even stronger because the Federal Reserve is planning to raise rates even higher in the coming months. Gold declining may provide an opportunity for investors to buy at a great deal, but when would it turn back up?
Experts are continuing to monitor the geopolitical activities that could mean another bull market for gold. President Trump has been continuing talks of pulling out of the Iran nuclear deal,a move that could trigger a sudden upward spike in gold prices. The other is his continued talks of tariffs on China and even EU products that have caused some short-term panic in the markets over talk of a trade war. Otherwise, the precious metal will probably ease down as projected.