Gold prices have tumbled to a near two-month low following Donald Trump’s recent election victory, as investors pivot towards equities and cryptocurrencies. The spot price of gold has dropped nearly 7% since the election, now trading at $2,559.2 per ounce, with futures slightly higher at $2,567.3.
The decline in gold comes after a year of record-breaking rallies for the precious metal. Citi’s global head of commodities research, Maximilian Layton, suggests that the pause in the bull market for gold and silver may continue in the coming weeks. The strengthening U.S. dollar, reaching a one-year high, has made gold more expensive for international buyers.
Equities have surged with expectations of lower taxes and deregulation under Trump’s administration, sending U.S. stocks to record highs. Cryptocurrencies, particularly Bitcoin, have also benefited, with Bitcoin briefly trading above $93,000.
Despite the current downturn, the fundamentals driving gold demand remain strong. Speculation around Trump’s tariff proposals and geopolitical tensions could boost demand as a hedge against economic risks. Central banks continue to purchase gold, contributing to its long-term potential.
As the initial market euphoria settles, experts anticipate a continued strong international demand for gold, especially with rising debt and geopolitical uncertainties.
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