Gold and silver exchange traded funds are in the red for 2012 and have been hit by a surging U.S. dollar as investors continue to fret over Europe’s seemingly endless debt crisis.
The metals ETFs have been hit by a stronger dollar in May. For example, PowerShares US Dollar Index Bullish (NYSEArca: UUP) has seen only four down days this month. [Dollar ETF Rallies 5% in May Breakout]
Investors have been favoring the dollar and U.S. Treasuries as the primary safe havens, rather than gold, in the latest round of the Eurozone debt fracas.
“Bullion hasn’t been in negative territory this late in the year since 2008, when investors were liquidating assets and scrambling for refuge,” The Wall Street Journal reports.
“It’s been behaving more like a risk asset than a safe haven,” said Joe Foster, portfolio manager of Van Eck Global’s International Investors Gold Fund, in the WSJ story.
Of course, not everyone thinks gold’s best times are behind it as central banks keep easy monetary policies in place and Europe heats up again.