Gold's Changing Relationship With The Dollar

Gold’s relationship with the U.S. dollar is about to change

But “in recent years, we have seen increased interest in trading hubs in the East,” including the establishment of the Shanghai Gold Exchange, the Singapore Gold Exchange as well as Asian-tailored product launches by the CME in Hong Kong, he said.

Gold demand outside of the U.S. has no clear-cut link to dollar movements, with Chinese demand having been as likely to rise when the dollar strengthens as it has been when it weakens, Artigas said in the report.

Gold is also likely to see more transactions being settled in nondollar currencies as the gold market “becomes less a spoke-and-wheel model ... and more a regional web-like exchange structure,” he said.

Asian markets made up close to 80% of global physical gold demand in 2013