Gold had showcased an unprecedented run-up from 2004 to 2011, where prices of gold went up from $400 to $1,900 an ounce. Since peaking in 2011-12, gold is now trading down by 34 percent.
The US Fed raised the borrowing rate twice this year and is on course to hike it further, backed by the strong labour market and rising inflation. It is expected that US Central bank would lift the rates twice this year.
A strong dollar is prompting traders to stay away from taking big bets on gold. A firm dollar makes gold expensive for holders of other currencies as gold is priced in dollar.
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