Where will gold prices go after Donald Trump was elected US President?

The price of gold after the US presidential election with the election of Donald Trump is attracting special attention from investors and people.

Reporter of Cong Thuong Newspaper had an interview with Associate Professor, Dr. Nguyen Huu Huan, Senior Lecturer, Ho Chi Minh City University of Economics , to analyze the gold market developments before the impact of Mr. Donald Trump's election as US President.

- At noon on November 6 (Vietnam time), Republican candidate Donald Trump announced his re-election as US President . In your opinion, how will this affect the gold market in the short and long term?

Associate Professor Dr. Nguyen Huu Huan: When Mr. Donald Trump is elected, the USD will strengthen, which will affect the price of gold in the short term. However, statistics after previous US presidential elections show that the price of gold is not affected too deeply, both in the short and medium term. Therefore, Mr. Trump's re-election as President is only an indirect factor, not directly affecting the price of gold too much.

Associate Professor, Dr. Nguyen Huu Huan, Senior Lecturer, University of Economics, Ho Chi Minh City.

The second factor affecting gold prices is the de-dollarization policy of many countries. Recently, BRICS member countries have proposed and pursued a de-dollarization policy, by which central banks will increase gold reserves to strengthen their currencies, creating a new monetary system. Although it has increased to a record level, the price of precious metals still has many factors supporting its increase in the coming time, such as the demand for physical gold in many Asian countries during the wedding season at the end of the year, and buying gold during the Lunar New Year. In the international market, countries continuously announcing interest rate cuts is also one of the reasons that positively affects gold prices.

If the US government 's policy under former President Biden and Ms. Harris was relatively broader and softer, under Mr. Trump, the policy will be stronger, even with allied countries like NATO.

In my opinion, in the medium term, gold prices will continue to increase, but in the short term, gold prices will likely correct sharply and decrease in the coming time because gold has increased sharply for a long time and there are sessions for investors to take profits.

- Currently, on social networking forums, many people advise each other to sell gold to make a profit because they are worried that Mr. Trump's election as President will cause the price of gold to decrease. What is your assessment of this situation? Please give advice to people and gold investors at this time.

Assoc. Prof. Dr. Nguyen Huu Huan: As I said above, in addition to the increase in the value of the USD and global geopolitical instability, gold prices are also supported by many other factors such as de-dollarization. Mr. Trump's re-election as President does not directly affect the gold market.

When Donald Trump is elected, the USD will strengthen, which will affect gold prices in the short term.

Therefore, this is also the time to take profits if gold is profitable. Buyers can also wait for the gold price to decrease during the adjustment sessions to buy at a lower price. In the case of buying gold as "savings", in my opinion, it is not necessary to sell. The price of gold falling by a few million VND per tael is normal at the present time because this precious metal has increased by about 40% since the beginning of the year and the probability of adjustment in the near future will be relatively high.

It can be seen that the world and domestic gold prices are connected. However, the domestic gold price, especially SJC gold, will increase more slowly, that is, adjust more slowly than the world, because the State Bank has controlled the price. The ring gold price will adjust, seemingly following the world trend. That is why there are times when ring gold is higher than SJC gold.

- In your opinion, besides the State's measures to manage the price of SJC gold bars, is there any better solution to stabilize the gold market?

Assoc. Prof. Dr. Nguyen Huu Huan: In my opinion, if the State does not manage the price of SJC gold bars, the difference between domestic gold prices and world gold prices will be very high, because the source of imported gold to meet domestic demand is relatively limited.

On the other hand, opening the gold market is also quite difficult because Vietnam's foreign exchange reserves are not large. Spending several billion USD each year to import gold is unnecessary and gold is not an essential commodity. Therefore, stabilizing the gold market is important, but at the present time, Vietnam should prioritize economic development. When Vietnam's economy is as strong as China's, opening the gold market becomes simple.

Besides letting the State control the gold price, there is a better solution, which is not to let people own SJC gold and pure gold. Instead, people will own gold credits. This means that people can buy gold credits from the State Bank or bring gold to the State Bank to exchange for gold credits. Gold credits can be traded like real gold and people can exchange gold credits for cash at the State Bank. Thus, it will reduce the phenomenon of gold in the economy, contribute to limiting gold accumulation among people and mobilizing resources among people to focus on economic development.

It is one of the measures that some countries like the US have applied in some tense periods and people just keep gold. However, this measure is stronger than the current State gold control measure.

Thank you!

This morning (November 7), the price of gold rings continued to fall sharply, losing the 88 million VND/tael mark, while the price of SJC gold bars remained unchanged at 89 million VND/tael. Specifically, Saigon Jewelry Company listed the price of gold rings at 86.4 - 87.9 million VND/tael for buying and selling, down 400,000 VND/tael compared to yesterday morning.

In just 2 days, the price of gold rings at Saigon Jewelry Company decreased by nearly 1 million VND/tael and is also the unit listing the lowest price of gold rings in the market.

In the ongoing trading session around the world, spot gold prices are still hovering around the lowest price in 3 weeks at 2,661 USD/ounce as the market reacts to President Donald Trump's victory.

Previously, on the evening of November 6 (Vietnam time), the price of gold fell sharply, breaking through the $2,700/ounce mark and then retreating to the $2,660/ounce range. Compared to the previous trading session, the world gold price lost nearly $84/ounce (-3%), marking the biggest one-day drop in the past 5 months.

Not only the spot gold price, the gold futures contract for December delivery on the Comex New York floor also fell sharply to $2,670/ounce, a significant decrease of $82, equivalent to a net decrease of up to 3%.

Source: https://congthuong.vn/gia-vang-di-dau-ve-dau-sau-khi-ong-donald-trump-dac-cu-tong-thong-my-357303.html