Gold Price News: Gold Near Six-Month Low 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.

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.