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Commodity Daily News
Gold and EUR/USD Correlation Strengthening
Thursday, 22 Dec 2011
Traders should note the high correlation between the EUR/USD the CRB spot commodities index. According to Reuters, the two assets have a 90-day rolling correlation of 0.55, and this trend looks to push higher. Thus, as the EUR/USD goes, so does the price of spot gold, or rather traders should think of the gold/EUR relationship in terms of the USD. Traditionally, gold has not performed well in periods of robust USD strength. As the European debt crisis continues to drag on, those who believe the debt crisis will take a turn for the worst may become less positive for the outlook on gold.
