Two weekend shocks: Gold price skyrocketed, will SJC reach 130 million VND?

Gold's sharp reversal and surge

World gold prices staged an impressive comeback in the final trading session of the week (August 23), dispelling concerns about the earlier sharp decline. Specifically, spot gold on the Comex exchange rose $33/ounce, or 1%, closing at $3,373/ounce. During the week, the precious metal had plummeted, at one point falling to $3,310/ounce due to profit-taking pressure from investors and expectations of a stable US economy .

However, two major "shocks" have pushed gold prices back up, reaffirming its position as a safe-haven asset.

The first factor is the clear easing signal from the US Federal Reserve (Fed). In his speech at the Jackson Hole conference on August 22, Fed Chairman Jerome Powell emphasized that the "balance of risks is shifting" between employment and inflation, with the risk of economic slowdown increasing due to tariff and trade policies.

Powell acknowledged that interest rates are in tight territory and that the Fed could adjust its stance if necessary, paving the way for a rate cut in September. This is the first time in a long time that the Fed has sent such a clear "dovish" message, despite the risk of inflation resurging.

Many financial and commodity markets in the US and around the world reacted positively: the US Dow Jones Industrial Average rose more than 600 points in the final trading session of the week, and US bond yields fell sharply. The gold market also benefited.

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World gold prices have risen sharply again. Photo: Kitco

The second factor is the deteriorating prospects for peace in Ukraine, escalating geopolitical tensions. Just a week after the summit between Trump and Putin in Alaska on August 15, US President Donald Trump threatened on August 22 to impose "massive sanctions or massive tariffs, or both" if there was no peace progress within two weeks.

The momentum for negotiations appears to have faded, bringing the parties back to square one. This increases uncertainty, supporting gold prices as a hedge against risk.

In addition, gold prices were also boosted by a sharp rise in crude oil (WTI oil rose to $63.66/barrel due to concerns about supply from the Middle East and Russia) and a weakening US dollar. The DXY index fell 0.9% to 97.73 points on August 22, making gold cheaper for foreign investors.

In the domestic market, SJC gold prices also heated up in line with global trends. In the final trading session of the week, Saigon Jewelry Company (SJC) listed the buying price at 125.6 million VND/ounce and the selling price at 126.6 million VND/ounce, an increase of 1.2 million VND compared to the previous session – a new record high.

The price of plain gold rings at Doji also reached a peak of 121.8 million VND/ounce (selling price).

The difference between SJC gold and world gold prices remains high, at around 17.7 million VND/ounce, reflecting strong domestic demand. Since the beginning of the year, world gold prices have increased by 28.5%, while SJC gold prices have increased by more than 50%.

Will SJC gold reach 130 million VND/ounce?

Global gold prices are facing strong supporting factors, but also risk a correction. Experts from major financial institutions predict the upward trend could continue until the end of 2025, averaging $3,500-$3,700 per ounce, thanks to Fed easing and geopolitical instability.

However, the possibility of stagflation and a slowdown in trade could curb the upward momentum in gold prices.

First, the prospect of a Fed interest rate cut is the main driver. Powell at Jackson Hole acknowledged the increased risk of an economic slowdown, although inflation could flare up due to tariffs "spilling through the supply chain." The Fed is heading towards an easing cycle, with the benchmark interest rate currently at 4.25%-4.5% per annum.

Although investors had already partially reflected expectations of a rate cut on September 17, new signals suggest the Fed is becoming more dovish, making gold – a non-yielding asset – more attractive. Pressure from President Trump is mounting: he has repeatedly criticized the Fed, demanded a sharp interest rate cut, even considered appointing a new Fed chair for the next term, and recently threatened to fire Governor Lisa Cook over allegations of fraud.

The weakening US dollar is also a positive factor. The DXY index fell not only due to the Fed but also due to the trend of de-dollarization (countries like China and Russia increasing their gold reserves), and the widening US budget deficit. Central banks and ETFs continue to accumulate gold: according to the World Gold Council, net gold purchases in the first half of 2025 reached a record high, with ETFs like SPDR increasing their holdings when prices dip below $3,300.

Conversely, the trade war has eased: Trump signed an executive order postponing tariffs on China for another 90 days, and Canada withdrew its retaliatory tariffs, paving the way for negotiations. This reduces inflation risk, which could cause gold to lose momentum.

Most experts from major financial institutions are optimistic about gold. JP Morgan Research forecasts gold to average $3,675 per ounce in Q4 2025, rising to $4,000 by mid-2026, driven by central bank and investor demand.

Goldman Sachs emphasizes that central demand will push prices to new record highs. InvestingHaven predicts gold will reach $3,500 in 2025, peaking at $5,155 by 2030.

UBS also issued a forecast, targeting $3,600 by the end of the first quarter of 2026 due to tensions in Ukraine and the risk of US inflation.

Domestically, SJC gold and gold ring prices are further supported by the USD/VND exchange rate exceeding 26,500 VND – a record high due to increased imports and foreign capital withdrawal. If world gold prices reach 3,400-3,500 USD and the VND weakens further, SJC gold could reach 130 million VND/ounce in the fourth quarter. However, if the Fed delays rate cuts due to inflation, prices may adjust downwards.

Overall, gold remains the "king of safe havens" amid uncertainty, with many forecasts predicting a 5-10% increase by the end of the year, centered on the Fed's actions, the situation in Ukraine, and the trade war between the US and other countries. Domestically, the price of SJC gold is not far from the 130 million VND/ounce mark.

US-Russia No Agreement Yet: What's the Forecast for Gold Prices? World gold prices experienced their sharpest decline since June during the week of August 11-15 amid mixed US inflation data. The US-Russia summit ending without an agreement on Ukraine could boost gold demand.

Source: https://vietnamnet.vn/hai-cu-soc-cuoi-tuan-du-bao-gia-vang-sjc-co-len-130-trieu-dong-2435460.html