There has been a clear divergence in the fortunes of the Dollar and the Euro this week which has weighed heavy on the gold price and the yellow metal's safe haven status.
Head of Dealing and Settlements Roland Khounlivong, said, 'Today's announcement that the Greek parliament has agreed the new austerity measures and therefore agreed to creditor conditions, has pushed the Euro down around 1.5% from last week, and given some investors their risk appetite back.
'Gold's see-saw relationship with the US dollar has meant that as it strengthened this week, so gold went south. Helping the swing was US Chair of the Federal Reserve Board, Janet Yellen, who said the raising of interest rates there is very much on the agenda. She also confirmed that the US economic recovery is on track and won't be worried by the situation in Greece or the shaky Chinese stock market.'
The result has been gold heading back to mid March levels, but the gold/silver ratio is still well above 70, with silver being much cheaper relative to its yellow cousin. 'Silver is still underpriced in comparison,' says Roland Khounlivong, 'and now we're entering the holiday period we can expect the market to be relatively quiet until at least the end of August.
There will be some interesting figures out tomorrow in the form of the US Consumer Price Index, but then next week little in the way of interest and therefore we can expect the market to drift a little in the coming weeks.'
Week on week price performances
16/07/15 16:00. Gold down 1.6% to $1,144.67, Silver off 2.0% to $15.06, Platinum slipped 1.4% to $1,007.49 and Palladium fell 1.0% at $631.72. Gold/Silver ratio: 76
NOTES TO EDITOR
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