Gold Prices Fall as Dollar Strengthens

26 Nov 2024 , 11:01 AM

A stronger dollar and rumours of a possible ceasefire between Israel and Hezbollah slowed demand for safe haven assets, causing gold prices to plummet Tuesday to their lowest level in almost a week.

Earlier in the session, spot gold fell 0.2% to $2,621.06 an ounce, after plunging to its lowest level since November 18.

The ceasefire reports and the selection of Scott Bessent as Treasury secretary by U.S. President-elect Donald Trump caused a more than 3% decline in the price of gold during the previous session.

The price of U.S. gold futures increased by 0.1% to $2,621.10.

According to four top Lebanese sources, U.S. President Joe Biden and French President Emmanuel Macron are anticipated to declare a truce between Israel and the militant group Hezbollah in Lebanon soon.

Gold has always been regarded as a secure investment during periods of geopolitical and economic unpredictability, such as trade or conventional conflicts.

Following Trump’s threat to impose a 25% tax on all imports into the US on Canada and Mexico, the dollar appreciated vs its major counterparts. For holders of foreign currencies, gold loses appeal when the dollar gains strength.

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