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What effect does a devalued dollar have on precious metals?
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<p>[QUOTE="desertgem, post: 1368698, member: 15199"]One can just look at the dollar within the US as is in post 2 and 3, or compare the dollar with the world basket of currency, or since the dollar is the reserve currency for commodities, the USD relation to commodities. Since gold and silver is affected by the USD, as it gets stronger against the World basket of currencies, the price of gold and silver would drop if all other factors stayed the same, and conversely, a weaker USD against the world basket will cause the price to increase. IMO, gold and silver ( and other commodities) are being mainly affected currently by the USD/EUR ratio, such that if the Euro goes up, gold will also. If the euro goes down, so will PM ( unless one of the other factoras such as precious metals are seen as a risk off item, but that didn't seem to happen the last few "Scary world things". IMO.[/QUOTE]</p><p><br /></p>
[QUOTE="desertgem, post: 1368698, member: 15199"]One can just look at the dollar within the US as is in post 2 and 3, or compare the dollar with the world basket of currency, or since the dollar is the reserve currency for commodities, the USD relation to commodities. Since gold and silver is affected by the USD, as it gets stronger against the World basket of currencies, the price of gold and silver would drop if all other factors stayed the same, and conversely, a weaker USD against the world basket will cause the price to increase. IMO, gold and silver ( and other commodities) are being mainly affected currently by the USD/EUR ratio, such that if the Euro goes up, gold will also. If the euro goes down, so will PM ( unless one of the other factoras such as precious metals are seen as a risk off item, but that didn't seem to happen the last few "Scary world things". IMO.[/QUOTE]
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