Gold price today February 23, 2024 continues to 'climb', SJC gold increases to 79 million VND
Will gold prices have new developments?
In Directive 06 dated February 15, Prime Minister Pham Minh Chinh requested the State Bank of Vietnam (SBV) to urgently review Decree No. 24 on gold trading management. At the same time, propose solutions to effectively manage the gold market in the new situation and complete it in the first quarter of this year.
Immediately afterwards, Deputy Prime Minister Le Minh Khai also issued a document directing the State Bank to quickly summarize Decree 24 and report the results of the gold market inspection in February, not allowing domestic gold prices to differ too much from world gold prices.
So, from now until the change of Decree 24, along with the solutions proposed, what will happen to the gold market? Should investors "put money" into the gold channel or wait a bit longer?
Sharing with PV. VietNamNet, Mr. Huynh Trung Khanh, Vice President of Vietnam Gold Business Association, advisor to the World Gold Council in Vietnam, said: The price of SJC gold is too different from the world price due to asymmetrical supply and demand, not because any business or agency "fixes the price". Therefore, it is impossible to pull down the gold price by administrative measures.
“If the upcoming measures of the State Bank of Vietnam include an increase in the supply of SJC gold bars, the gold price will decrease. Otherwise, the gold price will still increase. Just like at the end of December 2023, in just one day, the gold price dropped to VND5 million/tael but now it has increased again to VND78-79 million/tael,” said Mr. Khanh.
Meanwhile, economic expert Nguyen Tri Hieu analyzed that the price of gold in recent days has been around 76 million to over 78 million VND/tael; especially on God of Wealth Day (10th of the first lunar month), the price of gold usually increases but decreases slightly compared to the previous day.
“It can be said that the current gold price is relatively stable, not changing much. From now until the end of March 2024, the gold price may fluctuate a lot without government intervention. The gold price will probably increase. The reason is that the gold market has been on an upward trend since the beginning of the year, following the world price increase,” Mr. Hieu commented.
Further analysis, this expert said that the trend of gold price in the market is increasing, but the fact that the US has not reduced interest rates is the pressure for gold price to remain the same as it is now.
“US inflation was at 3.1%, down from 3.4% the previous month. With inflation under control, the Fed may ease monetary policy. However, the 3.1% rate is still far from the inflation target of 2%. Therefore, it can be seen that the Fed will hardly decide to change interest rates between now and the end of the first quarter.
In that context, the world gold price is still restrained but still on an upward trend from now until the end of the year due to geopolitical tensions in the world, causing the gold price in Vietnam to increase accordingly," Mr. Hieu commented.
However, according to Mr. Hieu, the proposals of the State Bank to the Government regarding the adjustment of Decree 24 may affect the gold market and stabilize prices. This will keep the gold price at the current level; or even decrease if there are important decisions from the Government related to Decree 24.
Investors need to wait
Gold expert Tran Duy Phuong stated that the difference between SJC gold price and world price of about 10 million VND/tael is reasonable; if it is over 10 million VND to 15 million VND/tael, it is necessary to consider importing gold.
Mr. Phuong believes that the world gold price in 2024 will certainly increase to at least 2,200-2,250 USD/ounce. The reason is that the Fed will reduce interest rates, leading to other central banks reducing interest rates. At that time, money will flow through gold or stocks.
“Historically, gold prices have always increased during US presidential election years. Combined with the fact that major central banks have cut interest rates this year, the world gold price is likely to start increasing from the third quarter. This will also push up domestic gold prices,” said Mr. Phuong.
Given market developments, Mr. Phuong noted that investors need to be cautious when investing in SJC gold.
“If the State Bank allows imports, with a large supply, the price of SJC gold will certainly fall sharply. If no more imports are allowed, the price of SJC gold will be around 74-75 million VND/tael, and it will be difficult to fall further,” Mr. Phuong predicted.
Economist Nguyen Tri Hieu also recommends that investors who intend to invest in gold should wait longer, because the impacts of government policies and the amendment of Decree 24 could cause gold prices to reverse and decrease.
“The political situation in the US and the US presidential election this year have a strong impact on the gold market. Therefore, gold investors need to be cautious,” said Mr. Hieu.
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