Why Is Gold Acting Like The U.S. Dollar, Rather Than Against It?

Alphaville is wondering whether gold ETFs have been hit with liquidations. That’s because gold has been acting like a proxy for the U.S., rather than a hedge.

Gold fell recently since mid-June:

Chart

As the USD fell:

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Shares for the ETF GLD have indeed declined (below), though part of this could be explained by lower fees at a competing ETF ‘IAU’, which has seen its total shares rise (not shown).

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Still, Alphaville raises an interesting point. Why hasn’t gold been hedging anything lately? You can read more of their view here.

(Charts via Alphaville)

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