Gold vs Dollar, an update
Gold sees the $3000 per ounce target approaching. The dollar remains strong on geopolitical tensions and US inflation expectations. Gold vs Dollar is one of the themes of these weeks, so let’s see an update on their relative strength.
Shown above is the relative strength between gold and the Dollar Index. As can be seen, over a one-year period, the trend is all in favour of bullion. After a slowdown near the end of last year, the indicator started to rise again towards the highs reached in early autumn 2024.
The movement of gold, as can be seen from the graphs above, is unrelated to the performance of the commodities sector. This means that its movements are not the consequence of strong demand for commodities but are linked to its nature as a safe haven asset on the one hand and as an inflation hedge on the other.
