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Dollar worries 'to provide backbone' for Gold Investment

CMC Markets analyst Ashraf Laidi claimed today (July 3rd) that there are a number of factors which should keep Gold Investment strong in the next few months.

The inverse link between the Gold Price and the US dollar has reasserted itself so far this year and investors are subsequently watching movements in the greenback with great interest.

Mr. Laidi explained in an interview with Reuters that a range of dollar-related concerns - such as quantitative easing and China's request to create a new global reserve currency - are positive for the yellow metal.

He told the news provider: "Part of the reason gold's retreat was tempered really has to do with the limited upside to which the dollar is gaining.

"This is partially due to worries about quantitative easing and these Chinese rumblings about diversification."

A similarly optimistic outlook was expressed last week by experienced English analyst Alistair Gilbert, who formerly managed a Swiss fund management group with over $1 billion in assets.

He explained that the impact of the US government's huge fiscal output in response to the global financial crisis will continue to weigh heavily on the dollar for the foreseeable future.

With the US running negative real interest rates, massive federal and trade deficits, and printing trillions of new dollars to rescue reckless financial institutions, there is only one way that the dollar can go and that is down, which will be good for all commodities, but especially for gold," he wrote on

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