(Kitco News) - While most talk has recently focused on gold breaking records in euro terms, a closer look shows that the metal has been dominating the entire currency market.
Gold in euro terms has blown through key levels and on Wednesday hit a session high of €1,126.59 an ounce, its highest level since early May 2013 - up more than 15% since the start of the year.
Neil Mellor, senior currency strategist at Bank of New York Mellon, said that XAU/EUR has been doing well since November, when European Central Bank President, Mario Draghi first hinted that the central bank was considering expanding its quantitative easing strategy. Melor says he thinks gold priced in euros could continue to perform well as the ECB debases its currency.
George Gero, vice president and precious-metals strategist with RBC Capital Markets Global Futures, said that with the Greek election looming and the country’s uncertain future as a member of the eurozone, it makes sense for the country’s residents to hold gold as a safe haven
Gero added that it also makes sense for citizens in Eastern Europe and Russia to hold gold.
“It is convertible to other global currencies, it is liquid, it is portable and it has no political affiliations,” he said.
In the last few trading session of 2014, gold priced in Russian rubles dropped dramatically but has since reclaimed its highs. On Wednesday spot XAU/RUB continued to make historical highs, rising to RUB85,543.19 an ounce, a gain of more than 24% since the start of the year.
Ole Hansen, head of commodity strategy at Saxo Bank, said he likes gold priced in rubles as a good currency play and that gold in Canadian dollars has made some decent gains since the start of the year.
Wednesday, ahead of the Bank of Canada monetary policy meeting, XAU/CAD spot prices hit a session high of $1,575.29 an ounce, its highest level since early-April and up more than 14.5% on the year.
Bill Baruch, senior commodity broker at iiTrader.com said that he likes gold in Japanese yen terms and is expecting that to be another dominant force in the marketplace as investors focus on more quantitative easing from the Bank of Japan.
“The Bank of Japan is right on schedule with their easing program and I think that will help gold later this year,” he said.
Wednesday, spot XAU/JPY hit a session high of ¥153,883 an ounce, a gain of 8.5% after starting the year at ¥141,788 an ounce.
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