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- Author of the entry: Mennica Skarbowa
- Date of entry:
Although last week was full of important declarations and events on the international stage, it did not bring any concrete results. However, due to increased investor appetite for risk, gold prices ended the week down more than 2%, currently trading at their lowest level in nearly four months, and in PLN terms, in about a year and a half.
Last month, gold lost more than 2%, marking its first monthly decline in a year. Last Monday saw a continuation of this trend, with gold recording its biggest daily decline since November (-1.7%). After breaking through the 200-day moving average of $1,235/oz, the spot price of gold reached $1,218.31 per ounce.
Monday's sell-off, although primarily triggered by the stronger dollar, was also related to data coming out of Europe. The eurozone appears to be stronger than expected, which should allow the European Central Bank to slowly normalize its monetary policy and, as Wolfgang Schaeuble, the German finance minister, put it, end the "abnormal situation" that currently exists with regard to negative interest rates. On Tuesday, market liquidity was significantly reduced due to the American Independence Day holiday.
Wednesday and Thursday, despite important events on the international stage (such as North Korea launching missiles with a range capable of reaching Alaska), did not bring any significant price movements. Wednesday, however, brought signs of disagreement among Fed members regarding their assessment of the US economy. After the publication of the minutes from the last meeting of Federal Reserve members, it is clear that they differ on inflation forecasts, which slightly weakened the dollar. Thursday, in turn, brought weaker-than-expected data on private sector wages.
Friday saw prices fall to their lowest level in nearly four months after data on new jobs in the US non-agricultural sector turned out to be better than forecast (222,000 vs. 179,000). The dollar gained on the prospect of an imminent interest rate hike, and the spot price of gold fell to $1,207.15 per ounce. The week ended with a price of $1,215.65 at the close of trading in London and $1,213.20 across the Atlantic, representing a 2.5% decline for gold.
In Poland, also due to the weakened dollar exchange rate of around 3.71, last week ended with a drop below PLN 4,500 per ounce – a level not seen for nearly a year and a half. This price undoubtedly reflects both an increase in gold purchases by Polish investors and a reduction in their gold sales.
Last month, gold lost more than 2%, marking its first monthly decline in a year. Last Monday saw a continuation of this trend, with gold recording its biggest daily decline since November (-1.7%). After breaking through the 200-day moving average of $1,235/oz, the spot price of gold reached $1,218.31 per ounce.
Monday's sell-off, although primarily triggered by the stronger dollar, was also related to data coming out of Europe. The eurozone appears to be stronger than expected, which should allow the European Central Bank to slowly normalize its monetary policy and, as Wolfgang Schaeuble, the German finance minister, put it, end the "abnormal situation" that currently exists with regard to negative interest rates. On Tuesday, market liquidity was significantly reduced due to the American Independence Day holiday.
Wednesday and Thursday, despite important events on the international stage (such as North Korea launching missiles with a range capable of reaching Alaska), did not bring any significant price movements. Wednesday, however, brought signs of disagreement among Fed members regarding their assessment of the US economy. After the publication of the minutes from the last meeting of Federal Reserve members, it is clear that they differ on inflation forecasts, which slightly weakened the dollar. Thursday, in turn, brought weaker-than-expected data on private sector wages.
Friday saw prices fall to their lowest level in nearly four months after data on new jobs in the US non-agricultural sector turned out to be better than forecast (222,000 vs. 179,000). The dollar gained on the prospect of an imminent interest rate hike, and the spot price of gold fell to $1,207.15 per ounce. The week ended with a price of $1,215.65 at the close of trading in London and $1,213.20 across the Atlantic, representing a 2.5% decline for gold.
In Poland, also due to the weakened dollar exchange rate of around 3.71, last week ended with a drop below PLN 4,500 per ounce – a level not seen for nearly a year and a half. This price undoubtedly reflects both an increase in gold purchases by Polish investors and a reduction in their gold sales.
