Gold prices have just experienced a rare week of decline amid the election of Donald Trump as US president. Concerns are still rife in the market, with gold prices forecast to fall further this week.
The spot gold price on the international market in the week of November 4-8 dropped dramatically, from over 2,740 USD/ounce to nearly 2,640 USD/ounce. At the end of the week, gold returned to 2,684 USD but selling pressure was still very strong.
Domestically, SJC gold bars lost 5 million VND/tael in buying and 3 million VND/tael in selling, to 82 million VND/tael (buying) and 86 million VND/tael (selling). Plain round gold rings lost about 4-5 million VND/tael, depending on the brand.
The global gold sell-off occurred in the context of Republican candidate Donald Trump being elected the 47th President of the United States on November 6. In addition, profit-taking pressure and short-selling activities pushed prices down on the occasion of Donald Trump's event, making the decline even more unpredictable.
Previously, gold had a prolonged increase in 2023 and in the first 10 months of 2024. From the beginning of 2024 to October 30, the spot gold price on the international market increased by more than 35%, reaching a peak of 2,789 USD/ounce recorded on October 30.
Before the US election, gold had a correction, citing positive signals for Mr. Trump.
The bearish sentiment continued into the weekend, with many fearing that Donald Trump’s policies, coupled with a “follow the flow” move, could send gold prices plunging even further this week.
Concerns about the outlook for gold prices increased after Donald Trump made a victory speech, declaring that he would stop wars. Previously, Trump repeatedly declared that he would end the conflict between Russia and Ukraine as well as ease tensions in the Middle East.
The North Korea issue was also handled quite gently by Mr. Trump during his previous term.
The prolonged increase in world gold prices in recent years is mainly due to soaring inflation globally due to the conflict in Ukraine and the post-Covid-19 pandemic, as well as geopolitical tensions in many regions around the world, thereby disrupting global supply chains.
Now, inflation has fallen sharply. US inflation is heading towards the 2% target (from 9.1% in June 2022), and geopolitical tensions may ease with Trump taking office.
However, that is only the market expectation. Besides inflation and geopolitical tensions, gold prices are also greatly affected by the strength of the USD, US bond yields and interest rates.
US interest rates are in a downward cycle. The US Federal Reserve (Fed) has cut interest rates twice, once in September and again on November 7. More cuts are expected, with interest rates from the current level of nearly 5% possibly falling below 3%/year in 2026. At that time, the USD may depreciate, pushing gold up.
Not to mention that world inflation could enter a new record-breaking cycle, not inferior to 2021-2022, when countries competed to lower interest rates and pump money to revive the economy , and inflation in fact has not yet reached the expected level.
A series of forecasts from reputable organizations still believe that gold prices will increase in the medium and long term, possibly reaching $3,000/ounce in 2025.
But for now, the pessimism after the Donald Trump event is present and the forecast for gold prices next week is likely to continue to decrease. The news that China has stopped buying gold for the sixth consecutive month also affects the outlook for the precious metal.
On Kitco, most Wall Street experts said that gold prices will continue to fall after Donald Trump was elected president. Meanwhile, individual investors have wavered. Inertia and Trump's statements may drag gold down in the new week.
According to Kitco's survey, 64% of experts predict gold will fall, only 21% predict it will rise and 14% are neutral. Meanwhile, Main Street survey shows that individual investors are no longer overwhelmingly optimistic. Up to 36% think gold will fall in the new week and 18% predict it will be flat.
It is forecasted that domestic gold prices this week will fluctuate according to world gold prices.
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Source: https://vietnamnet.vn/du-bao-gia-vang-tuan-nay-bi-quan-ngap-tran-lo-con-giam-nua-2340661.html
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