Gold takes a breather

The sudden move of the gold price is difficult to sustain. As anxiety concerning the financial system is waning, pressure on the price of gold seems to be mounting.
But before we let gold go down into some form of correction, we thought it would be useful to observe the consequences the rally of last couple of weeks had for some currencies.
Last week gold appreciated 10.9% versus the GBP and 6.5% versus the EUR. And if we look to the performance of the yellow metal since the start of this year, there are only two currencies which are goldwise priced even or below their year-starting levels. These are the JPY and the USD.
An indication that disinflation is the strongest in those two countries.

Now it is waiting for the reflation scenario to start.
Will commodities be the likely winners?

So far so good: the PowerShares DB Commodity Index Tracking Fund are going nowhere so far….

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