The price of gold fell below $4,000 an ounce and is on track for its worst quarterly performance in more than a decade, after expectations of rising US interest rates and waning interest from retail investors sparked a sharp sell-off in the market.
In the past three months, the value of gold has decreased by almost 14 percent, although at the beginning of the year it reached a record of almost 5,600 dollars per ounce, and analysts cite as the main reasons the strengthening of the US dollar, the more restrictive monetary policy of the Federal Reserve and the redirection of capital towards actions from the artificial intelligence sector and companies like SpaceX.
Additional pressure on the market is created by money outflows from funds that invest in gold (ETFs), as well as new restrictions on trading in precious metals that Chinese banks introduce for small investors.
Analysts point out that gold traditionally loses its appeal when interest rates rise, as investors then prefer to choose bonds and other yielding assets.
However, experts believe that the continuous purchase of gold by central banks could moderate the price drop and prevent even greater losses in the coming period, reports “IrishTimes”.
