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Gold prices on Monday is reduced considerably after the strengthening of the dollar against most world currencies caused a reduction in demand for the metal as an investment alternative.
The dollar to a basket of six currencies of countries - major trade partners of the U.S. grew by 0.44% to 79.66 points on the background of weak macroeconomic data in Europe and China, which have increased concerns about global economic outlook.
On Monday, it became known that the PMI index in China's industry, calculated by HSBC, according to the original estimate, rose in April to 49.1 points from 48.3 points in March. Despite the positive trend, the indicator for six consecutive months is below 50, which means a decline in the sector.
Investors remained concerned about the unstable economic situation in the euro area.On Monday, fears of bidders increased after it became known that the composite index of business activity in the industrial and service sectors for the 17 euro zone countries, according to preliminary estimates, in April fell to their lowest in five months in the value of 47.4 points from 49.1 points in March. These differed from the forecasts of analysts who had expected growth rate to 49.3 points.
At the same time, the appreciation of the dollar affects the political instability in some countries in Europe. Thus, the Prime Minister of the Netherlands Mark Rutte on Monday resigned after unsuccessful negotiations with the opposition on the budget in 2013 and possible measures to overcome the crisis.
Investors also continue to monitor the presidential elections in France. In the first round of the representative of the Socialist Party, Francois Hollande and the current president, the leader of the ruling "Union for a Popular Movement," Nicolas Sarkozy in the second round with 28.63% and 27.18% of the vote respectively.
However, a little optimism in the market on Monday brought news that the resulting increase in reserves of the International Monetary Fund has managed to attract an additional 430 billion dollars.
May gold futures on the COMEX fell today to $ 1624.4 an ounce.
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