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Experts were raising doubts during the previous weeks relative to gold's growth this year. They believe that the said metal will maintain its position around $ 1,800 level.
On the morning of February 17, the price of gold declined. According to experts, the US dollar's strengthening contributes to such movement. On the New York Stock Exchange Comex, the April futures for precious metals plunged by 0.55%, that is, to $ 1,789.1 per troy ounce. After that, the downward movement continued – gold was trading in the range of 1788.50-1788.60, trying to break through the current framework.
Based on analysts' observations, gold hits an anti-record for the sixth session in a row. Aside from the dollar's uptrend, gold' position is also affected by the growth of the yield on US government bonds. It can be recalled that this factor supports the USD rate, but has a negative effect for gold, since it becomes more expensive for holders of other currencies. Chintan Karnani, Lead Analyst at Insignia Consultants, said that the gold has no growth impulse in the market. Thus, we have a rather pessimistic sentiment.
Currency strategists at Morgan Stanley, largest US investment bank, totally agreed to such rhetoric. They are following a "bearish" trend in gold prices, expecting it to decline by the end of 2021. The bank believes that this precious metal will remain below $ 1,800 per ounce at the end of this year.
Moreover, experts from this company also argue that the inflation rate and moderate economic growth in the US will influence gold's price. According to them, the current situation is not beneficial for gold. The bank emphasized that the weak dynamics of pricing can result in further price reduction of raw materials.
"The improvement in economic indicators leads to the fact that gold shows a worse return than other assets," Morgan Stanley said.
Currently, the yellow metal is not very attractive for investors, but the situation may change at any moment.
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