Gold in a rising dollar environment

26-Mar (World Gold Council) — Generally, there is an inverse correlation between gold and the dollar. However, our analysis shows that the gold price increases more when the dollar weakens than it falls when the dollar strengthens. In our view, the dollar’s relationship with gold has changed dramatically over the past decades and is likely to shift further as demand moves East and the world moves to a multicurrency system.

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PG View: As we noted throughout the recent dollar rally, gold has proven very resilient. As the dollar index set new 12-year highs, the yellow metal wasn’t even able to get below last November’s low.