Gold prices witnessed a noticeable decline during trading on Tuesday, losing more than $21 of its value, falling below $2,400 per ounce again, coinciding with the recovery of the US dollar index in trading, which weakened demand for gold.

Performance of spot and futures gold contracts:

In terms of trading, gold futures for December delivery fell by 0.63%, or about $15.30 per ounce, to trade near $2,429 per ounce. Spot gold futures also fell by 0.91%, or about $22.0, to trade near $2,387 per ounce.

Reasons for the decline in gold prices:

Gold prices have been clearly affected as demand for the precious metal continues to be weak, despite the tensions and collapses witnessed in various global financial markets at the end of last week and the beginning of this week.

Gold prices have declined in conjunction with the gradual recovery of markets and the return of risk appetite to markets again, and the rise of the dollar index (which measures the performance of the US currency against about 6 other major currencies), as the index rose by 0.25% and recorded about 102.94 points. Since gold is denominated in dollars, the rise of the dollar always has negative repercussions on gold and vice versa.

The dollar clearly benefited during trading, coinciding with the strong rise in US bond yields today, as the US 10-year bond yield rose by 3.14% to record around 3.898%. The dollar also received a clear boost from the statements of the US Federal Reserve member, Mary Daly, in which she indicated that she is confident that inflation will return to the target, and that the recent US employment data is not a sign of an economic recession anytime soon.

It is noteworthy that fears dominated the markets regarding global inflationary recession, especially in the United States, at the end of last week, especially after the release of the US government jobs report for July last Friday, which showed weak numbers of US jobs and an increase in the unemployment rate to its highest level in 3 years, which caused a state of panic that dominated all financial markets, especially the US stock market, the digital currency market, and the commodities market.