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The price of gold and silver is falling rapidly

The value of gold and silver is falling to its lowest level in months due to the strong

US dollar.

At the beginning of October, the price of gold reached 1,834 USD, i.e. approximately 44,865 CZK per troy ounce (1 oz t = 31.103 grams), according to Compared to that, at the end of spring 2023, the price was 2,050 US dollars / troy ounce (i.e. 48,099 CZK 48,099, according to the exchange rate at the time). The value of silver fell as well, from 26 USD (CZK 610) to the current 21.43 USD (CZK 524) / oz t.

According to Tomáš Volf, an analyst at Citfin, the loss of value is due to the strengthening of the US dollar, caused by the decision of Fed to keep the base interest rate in the range of 5.25 to 5.5% p.a.

At the same time, Fed expressed its intention to keep interest rates at a high level for

a long time, and even increase them further. The dollar itself thus becomes a more profitable asset than precious metals.

Tomáš Volf adds that the price of gold and silver will return to its original values at the moment when the American central bank starts expressing itself in a "dovish tone" and the dollar starts to weaken as a result of the drop in interest rates. The price of gold could thus return to above 2,000 USD and the value of silver to 25 USD per troy ounce. However, this turnaround will probably take place not earlier than after several months.

SOURCE: (3/3/2023)


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