Does a Strong Dollar Push Gold Down?
Gold is quoted in dollars. When the dollar strengthens, the same ounce costs more in every other currency — and demand outside the US softens. The inverse relationship is one of the most reliable in macro, which is exactly why the exceptions are worth understanding.
— What it is
The dollar's strength vs. a basket of currencies — usually inverse to gold. This is the Fed's broad dollar index (Jan 2006 = 100), a different basket from the commonly quoted ICE "DXY", so the levels are not directly comparable.
— What it moves
Gold
Gold is priced in dollars. A stronger dollar makes gold pricier in other currencies, dampening demand.
- ▲Dollar strengthens → bearish for gold
- ▼Dollar weakens → bullish
Silver
Silver is priced in dollars; a stronger dollar likewise dampens silver demand.
- ▲Dollar strengthens → bearish
- ▼Dollar weakens → bullish
Education only — not investment advice. The directional notes describe general tendencies, not predictions: the same data can move markets differently depending on context. Figures come from FRED and are labelled with the period they cover and the date they were published.