The US dollar is battling intense pressure mounted by the growing debt pressure metrics. External factors, including the dollar ditching concept and war-like situations brewing in the US, are further battering the USD, weakening its stance and putting a dent in its global prestige. 

Also Read: Gold vs.USD: World Dynamics Are Favoring Gold Over USD

Gold Surges, USD Loses

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Gold has yet again broken a fresh record by surging to $2,350. The precious metal is now trading at $20 per ounce away from touching and establishing a new price, signaling a bearish outlook for the USD.

“Gold is trading $20/ounce away from record closing highs. A close above $2,390/ounce (spot) will trigger a new record closing low for the US Dollar coupons.”

Gold is trading $20/ounce away from all time record closing highs.

A close above $2,390/ounce (spot) will trigger a new record closing low for the US Dollar coupons.

— Peter Spina GoldSeek | SilverSeek (@goldseek) May 10, 2024

The weakening of the USD has been triggered primarily due to several reasons. Firstly, US debt has surpassed the $34 trillion mark, putting intense pressure on its equities and bond market. Secondly, the US heavily relies on money printing methodologies to boost the US dollar index, further adding to the woes of the receding US economy. 

“The debt of the United States is now 35 trillion dollars, and it is growing rapidly. Interest expenditure now accounts for more than 20% of U.S. fiscal revenue. The world has seen the risk of U.S. bonds. It is normal for them to sell U.S. bonds and buy gold. In past years, the United States relied on printing money to promote consumption and maintain GDP growth, causing high inflation. It also raised interest rates to maintain a high US dollar index.”

IF the Dollar confirms a move above the $106.6 level

Then it would suggest a breakout – a headwind for stocks

But based on the current structure, our bias is bearish for USD

— Game of Trades (@GameofTrades_) May 9, 2024

The US economy is documenting a striking decline in all its leading verticals. Per a notable analyst, DaiWW, America is noting a decline in the generation power vertical. At the same time, the nation’s federal government revenue is declining, adding intense pressure to the economic regime.

“But the United States has been declining rather than growing. Power generation is declining, federal government revenue is declining, and industrial output is declining. AI is still just a big bubble at present, and the only growth for the US is service-oriented consumption, which is quite hollow.” 

With the multipolar concept raging ahead, the US dollar is inching towards its decline if the metrics continue to slip towards the South. 

Also Read: Gold’s Allure Compels Chinese Investors To “Hodl” The Yellow Metal

The US Dollar Has New Competitors.

While China and Russia have already ditched the USD, a new competitor has joined the queue to challenge the American currency. 

Per new reports, India has recently struck a deal with Nigeria that will not make use of the dollar in its trade proceedings. Both nations have agreed to transact in local currencies, taking the dollar-ditching phenomenon to a new level. 

India has entered into a major trade partnership with Nigeria by moving away from the US dollar.

Both countries will use local currencies in the bilateral trade agreement for the energy, pharmaceutical and transport sectors.

— Sprinter infofactory (@Sprinter00000) May 10, 2024


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