Posted 12th May 2023

Gold Price News: Gold Drops Slightly But Outlook Remains Supportive

gold fine bar bullion

Although gold may be falling from the record levels it achieved earlier in the month, the precious metal continues to trade comfortably above $2,000 an ounce, a threshold that gold has only surpassed a handful of times in its long trading history.

The slight pullback is more a reflection of a market rebalancing rather than representative of a fundamental shift in the outlook for gold. The macroeconomic conditions remain favourable with the US inflation data released earlier in the week giving the Federal Reserve the necessary breathing space to potentially pause its interest rate hike cycle.

And while the health of the US economy should be a cause of optimism for markets, confidence remains very fragile following the country’s banking crisis and therefore supports keeping haven assets such as gold in play for a while longer yet.

So while the peak for the gold price may have passed, it is unlikely to fall away dramatically from these elevated levels any time soon. Certainly while the prospect of a US default remains on the table as talks continue on lifting the country’s debt ceiling, gold’s safe haven appeal is going to remain very attractive to investors.

After monthly gains in both March and April and a strong start to May, it will be interesting to see if gold can sustain sufficient support in the second half of the month to achieve a third consecutive monthly gain. So far the picture points to that being achievable with the current price still about $30 an ounce above where it was trading at the start of May.


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.

This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.