NEW YORK (TheStreet) --Shares of Barrick Gold (ABX) are down by 2.85% to $11.94 in mid-morning trading on Tuesday, as the mining sector takes a hit due to the slump in the price of gold, which is below the $1,200 per ounce mark.
The price of the yellow metal is declining due to the rally in the dollar, which is up by 0.81%, according to The Wall Street Journal dollar index.
The dollar is moving higher due to the "more pronounced rise" in the U.S.' core inflation rate for the month of April, which is making it "more probable that the Fed will raise interest rates," Commerzbank said, The Journal reports.
When the dollar rises the price of gold will usually fall as dollar dominated commodities become more expensive to those that hold other currencies.
Additionally, Barrick Gold announced today that it has struck a deal with Chinese mining company Zijin Mining Group, as company Chairman John Thornton fulfills one of his major goals by forming a strategic link with China, Bloomberg reports.
As part of the deal Barrick said Zijin will acquire 50% of its gold mine in Papua New Guinea for $298 million. In the future the two companies will look into the possibility of constructing joint mines.
"Our partnership with Zijin is the first step in a long-term strategic relationship with one of China's leading mining companies-a multi-faceted partnership that will provide significant opportunities to work together on an ongoing basis as we continue to create value for our respective owners," Barrick said in a statement.