Review of EGU Price for the Last Month
Statistics from the past 28 days showed that the EGU prices have risen by less than 1% on 16 days and increased between 1% to 6% across 12 days. There was a price increase above 3% for two days, namely on 2 February and 3 February. We attributed the result to market volatility caused by the start of the Trading Competition Grand Final, where users were actively trading their EGUs in preparation for it, and hence, creating a higher price change.
Market News Recap
February has been tumultuous for gold. The metal saw new lows amid rising US Treasury yields, which offset gains from a weakening dollar. However, Commerzbank analysts say it’s a tsunami scenario–prices now are pulling back but will surge again with force later in the year.
In the beginning of February, both the US dollar and Treasury yields rallied to push the price of gold below the psychological level of USD 1,800 in the first week of February. However, it bounced back to USD 1,810.26 per ounce as the week ended, amid a weakening dollar and dismal US employment data.
This turned out to be a temporary reprieve. On February 17, gold prices dropped to a 2.5-month low of USD 1,768.60. Even as prices continued to fluctuate throughout the month, they repeatedly fell below USD 1,800 and remained at that level as February came to a close.
“Overall, there are conflicting forces. We have the rising yields, but a weaker dollar,” said Bank of China International analyst Xiao Fu. Anticipation of economic recovery has also threatened gold’s appeal as a safe-haven asset.
But as the US lowers real interest rates and prepares for a stimulus package that could trigger high inflation, analysts believe gold will recover in the later half of 2021. Sunilkumar Katke, head of currencies and commodities at Axis Securities, believes gold could rebound to USD 2,000 this year.
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