Gold prices may reach new highs as USD, bond yields decline

12/24/2023 09:28 Nhat Linh Print article

ANTD.VN - The decline of the US dollar and US Treasury bond yields could push gold prices further up. According to experts, a technical breakthrough could help gold soon reach new heights.

Last week, domestic gold prices experienced strong fluctuations, especially in Friday's trading session, when the increase in SJC gold price reached 1.6 million VND/tael, up to 77.2 million VND/tael in the selling price.

Last week alone, SJC gold increased by a total of about 2.7 million VND/tael, to about 75.70 - 76.90 million VND/tael (buy - sell), establishing a new historical peak much higher than the old peak.

SJC gold price fluctuated strongly last week

The price of gold rings and 99.99 brand gold also increased by about 1 million VND per tael, up to around 62.00 - 63.00 million VND/tael.

In the world, the price of gold on the Kitco floor closed the weekend trading session at 2,052 USD/ounce, up 0.36%. The price of gold futures for February 2024 delivery on the Comex floor in New York traded at 2,064 USD/ounce.

The precious metals market has rallied strongly along with expectations of an early Fed rate cut. The US personal consumption expenditures (PCE) price index - the Fed's preferred inflation gauge - fell 0.1% in November from the previous month, the first decline since April 2020. Compared to the same period last year, the PCE increased 2.6% in November, after increasing 2.9% in October 2023.

This sign shows that inflation is under control, avoiding an economic recession and is also one of the important factors to determine the Fed's interest rate cut roadmap early next year.

The US Dollar Index (DXY) was at 101.76, near a five-month low. The yield on the 10-year US Treasury note hovered near its lowest level since July 2023.

According to CME Group's FedWatch tool, financial markets predict a 72% chance that the Fed will cut interest rates at its March 2024 policy meeting.

This has further strengthened the strength of the precious metal. According to experts, next week, gold prices may continue to be supported by the weakening of Treasury yields and the greenback.

Technically, experts predict the recent technical breakout could push gold prices to $2,100 an ounce, after testing recent record levels.

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