On February 13, the U.S. inflation data exceeded expectations and the U.S. dollar strengthened, and the international gold price fell sharply**, falling below the important mark of $2,000, hitting a new low in nearly a year and a half. This incident has aroused widespread concern in the market and has had a certain impact on both investors and consumers.
The main reason why the international gold price fell below $2,000 was the improvement of U.S. economic data, which led to a reduction in expectations of the Federal Reserve's interest rate cut, and the U.S. dollar index, which suppressed the safe-haven demand. U.S. CPI rose 3% year-on-year in January1%, higher than expected 29%；Core CPI grew 39%, higher than the expected 37%。These data suggest that inflationary pressures remain high in the United States, increasing the likelihood that the Fed will adjust its monetary policy in the future. The market's probability of a Fed rate cut in May dropped sharply, and the dollar index broke through the 90 mark. Since there is a negative correlation with the US dollar, the appreciation of the US dollar increases the cost of holding and makes it less attractive, so there is a significant increase.
Another reason why the international gold price fell below $2,000 was the easing of the global epidemic, which led to an increase in market risk appetite and a weakening of the hedging function. At the beginning of 2024, with the widespread vaccination and promotion of COVID-19 vaccines, the epidemic in many countries and regions around the world has been effectively controlled, and economic activities have gradually returned to normal. The market's confidence in the global economic recovery has increased, and investors have turned to assets with more growth potential, such as **, commodities, etc., reducing the demand for safe-haven assets such as **. In addition, some ETFs have also seen continued outflows, indicating that investors' bullish sentiment towards ** has weakened, further putting pressure on ***
The impact of the international gold price falling below $2,000 on the ** market is complex, with both advantages and disadvantages. For investors, the price of gold means a decrease in investment income, and even possible losses. Some investors may choose to stop losses or reduce their positions to avoid further losses. Other investors may choose to take dips** in anticipation of the price of gold**. For consumers, the price of gold means a reduction in the cost of purchase, which may stimulate consumer demand, especially on some traditional festivals or occasions, such as the Spring Festival, weddings, etc. For producers, the price of gold means a shrinkage of production profits, which may affect the supply of gold and even lead to the shutdown or closure of some high-cost mines. For central banks, a rise in the gold price means a decline in the value of their reserves, which may affect the structure and stability of their foreign exchange reserves, but may also provide an opportunity to increase their holdings to increase the diversity and security of their reserves.