Year-to-date, gold ended the week with a loss of 3.3%. Accentuating the increase in currency volatility, gold in Euro terms ended the week up 6.2% YTD while the US dollar index has gained 8.6% in 2014 (+9.4% since early May). Defensive assets suffer as cyclical equities regain vigour.
Byrne said that key driver of gold is negative real rates. There is talk of increase in interest rates by US Federal Reserve some time in early 2015. However, since the governments are in huge debt, raising interest rates actually raises the cost of holding such debt.