Gold price today April 8, 2024: Strong buying power, gold keeps rising
World gold is boiling, domestic gold is climbing
The world gold price in the last session of the week (April 6) increased sharply and surpassed the optimistic calculations of many leading experts in the world. After surprisingly surpassing the threshold of 2,300 USD/ounce, gold adjusted down but very quickly after that skyrocketed to nearly 2,330 USD/ounce.
This is a spectacular breakthrough because many organizations had predicted that gold would reach an average of 2,100 USD/ounce in 2024. Some boldly said that the gold price would rise to 2,200-2,400 USD/ounce, but the acceleration will fall in the second half of the year, when the US Federal Reserve (Fed) begins to reverse monetary policy and reduce interest rates.
However, gold prices have broken out despite the USD still hanging high.
The world spot gold price has maintained the $2,000/ounce mark since late February, then successfully conquered the unprecedented high of $2,100/ounce in March, then broke through to $2,200/ounce at the end of March before gently breaking through the $2,300/ounce mark in early April.
Immediately after surpassing the threshold of 2,300 USD/ounce, selling pressure pulled the world spot gold price below this level, but only for one session before breaking out to 2,330 USD/ounce as seen.
The US dollar is at a high level, but the world gold price has continuously reached new peaks over the past month. The paradox is that the US Federal Reserve (Fed) has continuously delayed interest rate cuts, from the expected 4 cuts in 2024 being reduced to 3 cuts in the meeting on March 21, to the statement of Fed officials last week saying only 2 cuts and then 1 cut.
On the night of April 5, Fed Board of Governors member Michelle Bowman delivered a surprising message to the market. She said that interest rates would likely have to be raised to control inflation, instead of the cuts that her colleagues had pointed out and the market was expecting.
Policymakers need to be careful not to ease policy too quickly due to potential risks from inflation, Ms. Bowman noted.
Domestically, gold prices have also broken through following the world trend, although the gap with the converted international price has narrowed. In the session on Saturday, April 6, SJC gold prices jumped to nearly VND82 million/tael, while gold rings in some places exceeded VND74 million/tael, an increase of another million VND/tael.
What is the target for gold prices in this fever?
The question is: What is the destination for world gold prices in this feverish price increase and to what level will the prices of SJC gold bars, gold rings, and jewelry gold climb?
In a recent report, Swiss group MKS Pamp said that the ceiling price of gold for 2024 in the previous report has now become the floor price.
In January, MKS Pamp predicted that gold prices would average $2,050 an ounce in 2024, with a low of $1,900 an ounce and a high of $2,200 an ounce. But now, gold prices have surpassed the $2,200 an ounce threshold. Meanwhile, the demand for physical gold from central banks around the world remains relentless.
MKS Pamp now raises its gold price forecast to an average of $2,200/ounce in 2024, with a low of $2,000/ounce and a high of $2,475/ounce (equivalent to nearly VND76 million/tael), or even close to $2,600/ounce.
However, MKS Pamp also warned that this organization has not taken into account the betting trend of the market. Accordingly, Western investors still invest quite low in gold because they still have to consider the long-term history of gold fluctuations.
In addition, there is also the impact of the world's major "gold players", including central banks of countries. Demand will skyrocket if they are forced to buy gold (which can finance wars, including the cold war)...
According to many experts, the surge in gold prices to new peaks shows that this commodity is no longer only mainly influenced by economic data and traditional US market sentiment as before, but has become a global monetary metal.
On Kitco, ABC Refinery expert Nicholas Frappell said that the surge in gold buying could be due to the risk-off momentum from strong stock markets in the West. But the main driver, he said, is gold buying due to a weakening Chinese economy.
Historically, corresponding to the Fed's rate cuts in 2000, 2006 and 2018, gold prices increased by 57%, 235% and 69% respectively.
This rally, including the breakout last weekend, has only brought gold prices up about 17.5% since hitting the $2,000/ounce support level in mid-February.
Thus, the breakthrough seems to be just beginning, especially in the context of many countries wanting to reduce their dependence on the US dollar and increasing geopolitical tensions in many regions of the world, including the heated Middle East between Israel and Palestine as well as Iran.
However, many experts on Kitco believe that gold prices may witness downward adjustments after the shocking increases.
According to a Kitco survey, 75% think gold prices will increase in the new week, while 8% predict a decrease.
Domestically, the difference between SJC gold price and converted world gold price has narrowed to about 11 million VND/tael (calculated according to bank exchange rate). If world gold price increases to 2,475 USD/ounce (equivalent to nearly 76 million VND/tael) and the difference narrows to about 6 million VND/tael, then SJC gold bar price will be around the historical peak of 82-83 million VND/tael. Ring gold price can maintain a difference of about 2-4 million VND/tael.
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