Gold Loses Safe Haven Appeal

July 31, 2018 Share Print 0

Gold is supposed to be a haven, a place for investors to turn during tumultuous times.

But in the middle of a trade war, gold has fallen into a correction, down more than 10% from its high for the year.

Why has the price fallen lately? Simply put, it’s the strong US dollar.

Expectations for more interest rate hikes by the Federal Reserve have helped lift the value of the currency.

A stronger dollar often is a bad thing for gold because it makes the metal more expensive for international investors.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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Alfonso Esparza

Senior Currency Analyst at Market Pulse

Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.