It's the dollar, stupid!
Central banks and governments around the world are once again engaged in a ‘currency devaluation’ contest. The US dollar has been on a sharp downward trend in recent weeks. This has had a significant impact on financial and real assets.
The chart below, which we borrowed from Hong Kong investor Puru Saxena and goes back all the way to 1980, suggests the dollar indeed is on a long-term downtrend.
Will gold keep going higher?
While everyone is watching the main US stock indices break records day after day thanks to FAMANG stocks, the gold price also keeps creeping higher towards $1800 per ounce. Many investors remain sceptical, as they struggle to value gold. But there’s a lot to say for the gold rally to continue.