Why is the price of gold falling?
Sharing with VietNamNet reporter, gold expert Chu Phuong commented that the decrease in gold price is understandable when there is pressure to adjust after the period of increasing to the record peak. Along with that, the fact that many investors take profits before the end of the year also puts pressure on gold price to decrease.
According to Ms. Phuong, the meeting between US President Donald Trump and Chinese President Xi Jinping has made investors expect positive progress in trade relations between the two countries. Although there has been no breakthrough, this development has somewhat eased tensions - a factor that had previously pushed gold prices up sharply.
In addition, the US Federal Reserve (Fed) cut interest rates by 0.25 percentage points, bringing the range down to 3.75-4%, as expected.
“Previously, the gold price had increased rapidly, so when the information was announced as expected, investors immediately sold according to the rule of 'buying on rumors, selling on real news'. When everything was clear, investors no longer had much basis to expect more,” Ms. Phuong analyzed.
She also said that Fed Chairman Jerome Powell's statement about the uncertainty of lowering interest rates in December caused investors to adjust their expectations.
Experts say that gold prices at the end of the year often decrease slightly but not deeply.
Meanwhile, the domestic gold price recently mainly reflects the fluctuations of the world market. “Investors’ psychology is usually to buy when the price increases, and sell when it decreases to lock in profits. Those who buy at low prices tend to sell at the moment,” Ms. Phuong said.
She said that the demand for gold at the end of the year is always high due to the wedding season and the preparation of gifts for Tet. With many years of experience, she saw that the price of gold at the end of the year often decreases slightly but not significantly. The development will follow the world price, and there will be few strong fluctuations.
“Many investors are still waiting for gold price adjustments to buy in order to protect the value of their assets after the period of overheating. If there is an adjustment, the decrease will not be too strong,” she predicted.
Will gold price drop to 100-110 million VND/tael?
Regarding the gold price trend in the coming time, economic expert Phan Dung Khanh said that it will likely decrease, maybe increase slightly in the short term, then decrease again and gradually go sideways.
Mr. Khanh analyzed that trade and geopolitical tensions in the world - such as the conflicts in Israel or Russia - Ukraine, are showing signs of cooling down, causing the demand for investment in safe assets such as gold to decrease significantly.
In addition, the Fed's initiation of a rate cut cycle will in principle support gold prices. However, this is happening in a context where inflation has been controlled, so inflation concerns have decreased, making the supporting effect on gold prices less strong.
In addition, other investment channels such as stocks, real estate, and even silver all increased, causing investment cash flow to tend to disperse, no longer focusing on gold. Along with that, the USD Index increased again, also creating downward pressure on precious metals.
“The gold price is too high, causing the attractiveness of investment cash flow into gold to decline, while the rate of return is difficult to maintain. This is the reason why the gold price is likely to enter a period of downward adjustment and sideways movement in the near future,” Mr. Khanh commented.
Meanwhile, Ms. Chu Phuong predicts that the gold price will fall to the range of 100-110 million VND/tael in 2025, which is an unlikely scenario. Technically, the world gold price has decreased by more than 10% from the peak. If it is balanced at the range of 3,900-4,000 USD/ounce, with buying power from large investment funds and central banks, the market may move sideways to accumulate, attracting new capital flows.
“Investors should not expect too much from bottom fishing in the 100-110 million VND/tael range,” she said.
Ms. Phuong noted that from November 15, banks and businesses will be allowed to submit applications for gold import, and approval is expected to be given by December 15. Therefore, domestic supply cannot increase sharply.
The gap between domestic and world gold prices is currently around 10-12 million VND/tael. Even if it is narrowed, this gap can only be reduced to 7-8 million VND/tael in the short term, not close to the world price.
Therefore, she recommends viewing gold as a long-term investment channel, not a short-term speculation. Those who buy gold in the "buy today, sell tomorrow" style are likely to lose money because the market is currently very volatile in both directions. It is normal for the world gold price to increase or decrease by 100 USD/ounce in a trading session.
She recommends that investors should not “go all in” at too high a price, should keep a calm mind, avoid chasing prices when they rise or selling off when they fall. If you get caught up in fluctuations, it will be difficult to stay calm and see the long-term trend.
“The long-term trend of gold prices is still up,” the expert affirmed.
Gold prices are too high, a series of omens appear for 2026. Many experts warn: once the price is too high, gold itself can become "a victim of itself".
Source: https://vietnamnet.vn/gia-vang-co-giam-ve-vung-100-110-trieu-dong-luong-tu-nay-den-cuoi-nam-2458051.html
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