The following table includes the correlation between gold and the most popular currency pairs over various timeframes. A value close to +1 indicates a strong positive relationship between gold and the pair, while a value close to -1 indicates a strong negative relationship.
|
Gold v.
|
USD/CAD
|
AUD/USD
|
NZD/USD
|
EUR/USD
|
GBP/USD
|
USD/JPY
|
|
|
3 Day 15 Minutes
|
-0.49
|
0.71
|
0.06
|
0.21
|
0.62
|
0.18
|
-0.20
|
|
1 Week 60 Minutes
|
-0.80
|
0.78
|
0.42
|
0.76
|
0.72
|
0.30
|
-0.79
|
|
2 Week 60 Minutes
|
-0.28
|
0.34
|
0.47
|
0.21
|
0.15
|
-0.03
|
-0.21
|
|
1 Month Daily
|
-0.79
|
0.78
|
0.68
|
0.54
|
0.59
|
-0.63
|
-0.54
|
Weekly Commentary: The correlation between Gold and the Australian Dollar is strong at +0.78 suggesting that markets appear to be trading with one another. Gold is most firmly correlated with higher yielding assets as markets desire return and thus sell their holdings in U.S. dollars, driving the greenback lower. Since gold is priced in dollars, it will have a natural tendency to rise in relative value as USD declines. Moreover, Gold, Aussie, Kiwi, CAD and most other risk linked assets have a tendency to trade with risk appetite. When volatility increases investors seemingly seek safety and sell the aforementioned risk-linked assets and move into the safe-haven USD.
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