Fall in SPDR, Gold spot prices in global market: Mecklai

Mecklai graph of the day: The fall of the Gold SPDR

The gold prices in the global markets have seen a steep fall since the beginning of this year (2013) from 1690 levels to a shocking 1180 levels, a fall of 22 percent. This has obviously taken a toll on the largest gold fund ETF SPDR as it also dropped from 1342 in Jan 2013 to 918.6 in Aug (lowest since Feb 2009).

Gold is considered as a safe haven for most investors and the SPDR contributes to the global economy as a strong indicator of its current health in the bullion market. Its fast decline has become a worrisome factor for the global health. Crash in gold prices in April due to euro region was the key reason for fall in ETF SPDR gold asset .The ongoing USD 85 Billion Fed bond buying has increased the supply of dollar in the market which have made investors more aggressive on taking more risks on the back of improving economy. This has made them gold averse, pushing them away from safe havens and towards equities. Hence, the precious metal which was ever chased for its value and safe sentiment has now become less attractive with traders flocking for equities to get better returns.

Below graph represents the fall in SPDR and Gold spot prices in the global Commodities market since the beginning of 2013

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