Pinnacle Activity Ticker
Gold Price Falls for Fourth Straight Month
Pinnacle Digest writes: Gold fell for the 4th straight month against the dollar in the month of May. Virtually every commodity fell in the month of May against the dollar for that matter and signs that the trend will change in June are looking bleak. If momentum does shift away from the dollar and back into commodities in June, it won’t be until the latter half - after Greece’s election and the Fed’s meeting. Both events have the potential to kick the inflation trade back into 5th gear.
In the article linked below, Adrian Ash explains the string of negative data working against gold and how the euro-crisis has only magnified the dollar as the only true ‘safe haven’ asset (according to global money managers). Whether you agree or not, the facts are the facts and as was the case in 2008, when debt levels in major economies skyrocketed, the world flocks to the USD.
The one piece of bullish news Ash points to in this article (in respect to the gold market) is the fact that the Turkish Central Bank stated it may gradually raise the percentage of required reserves commercial banks can hold in physical gold to 30%. Given that Turkey is a no-name global player, this won’t have a huge impact on gold demand; however, if larger nations adopt this policy as well, it could create a serious reversal in gold’s trend.
Click here to read article.