Investors Pile Into Gold, Dollar, Yen and Franc as Markets Melt Down

1 indicates a strong positive relationship between gold and the pair, while a value close to -1 indicates a strong negative relationship. Colored values indicate week-to-week changes of over 30%.

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Gold

USD/CAD

AUD/USD

NZD/USD

EUR/USD

GBP/USD

USD/JPY

USD/CHF

3 Day 15 Min

0.16

-0.01

-0.30

-0.37

-0.69

-0.66

-0.32

1 Week 60 Min

0.59

-0.70

-0.69

0.00

-0.68

-0.94

-0.75

2 Week 60 Min

-0.58

0.56

0.42

0.35

0.59

-0.28

-0.25

1 Month Daily

0.80

-0.72

-0.46

0.07

0.25

-0.71

-0.92

Gold-FOREX Correlations for last week can be found here.

Weekly Commentary: As markets dropped at their sharpest pace since the 2008 recession, investors flooded into safe haven assets. Heavy demand in gold as intervention fears from the SNB and Bank of Japan/Japanese Finance Ministry sapped confidence in the Swiss franc and Japanese yen as safe assets. The US dollar correlation against several riskier yield currencies including the Canadian, Australian and New Zealand dollars increased as risk aversion led a market-wide selling of those commodity currencies. The Swiss franc's correlation weakened this week due to the SNB’s rhetoric that they may use additional policies to curb the strength of the franc, including a possible peg to the Euro.

During this week, spot gold reached an all-time record of $1817.60 in GLOBEX trading on August 11th, 2011. Monday’s session gain of $55.73 represented the second highest dollar-value gain since 1990, only beaten by September 17th 2008’s record of $84.10. Additionally, the Federal Open Market Committee’s statement that they may hold interest rates low for an “extended period” added to dollar weakness and gold strength.

Please note: Chart uses franc rate as CHFUSD to show safety correlation with gold.