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Gold price dips are buying opportunities, weak jewelry demand not an obstacle: Commerzbank

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(Kitco News) A firmer U.S. dollar and optimistic U.S. macroeconomic data temporarily capped gold’s path above $2,000 an ounce, according to Commerzbank. But any price dips are currently being viewed as buying opportunities. “The gold price has climbed again on the back of the renewed depreciation of the US currency. What is more, yesterday’s considerable ETF inflows of 9 tons make it clear that falls in the gold price are viewed as buying opportunities,” says Commerzbank analyst Carsten Fritsch. “The weak jewellery demand is not posing any obstacle to higher gold prices at present.” Supporting drivers remain rising COVID-19 cases, U.S. fiscal stimulus being debated, and negative real interest rates. Also, there are signs that the jewelry demand is stabilizing, Fritsch adds. “According to a source close to the government, Indian gold imports declined by ‘only’ 24% year-on-year in July. The decreases in the preceding months had been much bigger (peaking at -99% in April). In addition, the 30 tons reported for July were the highest monthly imports since February, i.e. since the lockdown. This is giving rise to hopes that Indian jewellery demand could recover in the autumn – usually the period of highest demand.”

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