Gold prices are at their lowest in about 7 months


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Gold prices witnessed their lowest level in about 7 months, with the price of the dollar falling to its lowest level in the past six months, and with the start of the vaccination process against the new Coronavirus (Covid-19), and optimism about the global recovery increased.

In the past year in global markets, it supported the increased perception of risk due to the outbreak of the Covid-19 virus, the trillion dollars measures taken by central banks and governments due to the epidemic, the tension between the United States and China, and the second wave of epidemic fears.

The price of an ounce of gold rose until August, while the success of vaccination studies continues and the downward trend that began with the recovery continues.

At the local level, the price of a gram of gold, which witnessed its historical peak at 541 lira in November of last year, in parallel with the path of the dollar exchange rate, decreased by 25 percent in the past three months to 405 lira and witnessed its lowest level since July 22, 2020.

The decline in the price of an ounce of gold in the past three months reached 7 percent.

Among the market-friendly steps and the Turkish central bank from the downward trend that was seen in the past three months in the price of the dollar with a hard-line stance in monetary policy, economic management, the decline of an ounce, coupled with the price, the housing decline in the price of gold was rapid during this period.

At the global level, while the price of an ounce of gold is being suppressed in line with increased risk appetite with the flow of positive news regarding the US $ 1.9 trillion stimulus package in the United States of America, risks related to inflation expectations feed estimates of the lowest levels in bond prices and negatively affect the Demand for gold.

Withdrawal may last a little longer, but not always.

Islam Memiş, AA financial analyst at AA, who answered AA correspondent’s questions on the matter, said the declines in gold prices may continue a little longer, but he does not expect them to be permanent.

Memiş said, pointing out that the decline in precious metals with optimism about vaccines will not be permanent and will continue to rise throughout the year, “This is our expectation that countries such as China, India and Russia will continue their purchases of gold in 2021, announcing new incentive packages, and low interest policies.” And the wedding season.

We attribute this to reasons such as an increase in the actual demand for gold around the world. “

Memiş indicated that they estimate that the price of an ounce of gold stuck in the range of 1.780-1.850 dollars for the short term will be tested above 2000 dollars this year, and he indicated that the factors that supported gold prices last year continued this year.

Noting that the decline in the dollar / lira in the local markets caused a decrease in the price of a gram of gold, Memiş said: “We saw that the price of a gram of gold, which was negatively affected by the dollar exchange rate, fell to 405 lira, at the lowest level in 7 months.

We estimate that decreases in the price of a gram of gold will not be permanent, because the physical demand for gold can support the increase in both the gram of gold price and the price of an ounce of gold within a year.

“Especially with those who owe gold, they should follow the decline closely.”

Memiş indicated that the possible recovery in the dollar exchange rate during the year will also support the price of a gram of gold, and expected that the price of a gram of gold will be tested again above the level of 500 lira in the summer.