Posted 29th September 2023

Gold Price News: Gold Near Six-Month Low Under Pressure from Strong Dollar

gold under pressure from strong dollar

Gold is trading close to its lowest level in six months as the bearish macroeconomic environment for the precious metal is finally weighing on its price.

Having held above $1,900 an ounce for such a long period even with interest rates climbing to around 5% and a strong US dollar, the resilience of the global economy has finally forced down gold below that threshold as investors have adopted a more risk-on approach.

gold kau on kinesis exchange
Gold ($/g) price – 3-month view – from Kinesis Exchange

For much of the year, the trading community has been very risk-averse with confidence knocked by the US banking crisis of March and April. However after the data continues to show employment remaining healthy and fears of a recession receding, more money has gone into the equities market at the expense of gold as its safe haven appeal dwindles.

Yet while gold’s appeal is on the wane, the gold price is unlikely to collapse due to the strength of the underlying support from central banks of countries, such as China and Turkey, who have been bolstering their holdings of the precious metal as they look to diversify away from the US dollar. As such, gold is likely to go on a steady slide towards $1,850 an ounce over the coming weeks.

Rupert is a Market Analyst for Kinesis Money, responsible for updating the community with insights and analysis on the gold and silver markets. He brings with him a breadth of experience in writing about energy and commodities having worked as an oil markets reporter and then precious metals reporter during the seven years he worked at Bloomberg News. 

As well as market analysis, Rupert writes longer-form thought leadership pieces on topics ranging from carbon markets, the growth of renewable energy and the challenges of avoiding greenwash while investing sustainably.

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