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Gold in last-ditch attempt to erase 2022’s losses

Gold’s fortunes in 2022 were primarily dictated by the US dollar’s dominance that was fuelled by the Fed’s aggressive battle against inflation.

Given that gold is a zero-yielding asset, the precious metal’s traditional roles as a safe haven and as a hedge against inflation were greatly undermined by the Fed’s supersized rate hikes this year.

Still, spot gold has embarked on a stellar recovery since early November, launching itself back above its 200-day simple moving average (SMA) and also the psychologically-important $1800 mark.

Gold bulls are making every effort to completely erase 2022’s losses, with its annual decline now standing at a measly 0.6% at the time of writing.

Should spot gold manage to close at $1829.20 or higher, that would prevent the precious metal from registering back-to-back annual declines for the first time since 2015.

Gold makes last-ditch attempt to erase 2022’s losses

 

Gold’s luster may shine brighter at the onset of 2023 should the dollar be dragged lower by growing expectations for the much-hyped ‘Fed pivot’ later in the year.

Geopolitical tensions may also rear its ugly head over the coming year and trigger spikes in bullion demand on strong clamours for safe havens.

 

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