Sharp Decline in Stock Index Drags Gold Down
Donald Trump has made the world experience the biggest concerns in trade and the global economy. How could it not, all countries have received their respective portions for the tariffs that must be accepted if they export goods to America, something that will make the price of goods to be sold more expensive and will burden consumers.
There are several surprising facts that occurred after the implementation of reciprocal tariffs, namely a sharp decline in the stock market and strengthening of the dollar index, while commodities such as crude oil, copper, gold, and silver experienced a decline. Some analysts say that there are many investors who prefer to seek protection in currencies such as the Swiss Franc and Yen, while others say that the current decline in gold is because many investors are withdrawing profits from gold to cover losses on other assets, especially in stocks.
There is a lot of pressure currently on gold due to liquidity problems and margins that are closed by investors, but beyond all that, in the long term, gold is still predicted to increase amidst the unfavorable world trade situation which will most likely cause global inflation and especially inflation for the United States.
Source: (mrv@Newsmaker)
