The price of gold is influenced by the yield on bonds
Gold prices remain within the range of $1,725 - $1,745 an ounce this week amid conflicting forces of a strong dollar and low US government bond yields. On Thursday, the quotes fell to the lower limit of the range at $1,726.
The sell-off in the bond market that led to higher yields has slowed this week, most likely as a result of profit-taking. Fears of the spread of a new wave of coronavirus in Europe and elsewhere, as well as corporate tax hikes in the US to fund the stimulus package, have grown significantly. If bond yields continue to fall, then gold will rise in price, and only a further aggressive strengthening of the dollar can stop this process. But in the current market conditions, the risks for the dollar are really biased towards growth.
Despite the decline in optimism about the global outlook, things are still looking positive in the US due to rapid vaccination and economic recovery. Fed officials, while acknowledging that there is still a long way to go before a full recovery, are already optimistic about the country's economy this year, with some even talking about a sharp rise in 2022 and 2023. A strong dollar negatively affects the precious metal quotes, so the consolidation of the asset in the current range may last for some time.
I assume a decline in the price of gold to the level of 1705 dollars per ounce.