Why did the world gold price plummet more than 2%?

DNVN - The first trading session of the week on November 11 witnessed the world gold price drop sharply by more than 2%, affected by the rising USD, along with the influence of Donald Trump's victory in the US presidential election, affecting fiscal policy and interest rates.

Spot gold fell 2.5% to $2,617.96 an ounce. Meanwhile, US gold futures also fell 2.9% to close at $2,617.70 an ounce.

The dollar index rose 0.5% in the session to its highest level since early July 2024, making gold less attractive to non-dollar buyers. Last week, the dollar index rose more than 1.5% to 105.44, shortly after Mr. Trump’s victory announcement.

“The possibility of new tariffs being imposed relatively early in President-elect Donald Trump’s second term will create strong demand for the dollar,” TD Securities said. “A stronger dollar is weighing on gold for the first time in months as it is also linked to the possibility that the Federal Reserve may delay its monetary policy easing cycle.”

Gold prices suffered their biggest weekly decline in more than five months after Mr. Trump was re-elected as US president on November 5. This situation comes as the Fed is considering cutting interest rates as inflation approaches its 2% target.

Last week, the Fed cut rates by another quarter point to a range of 4.5% to 4.75%. Investors now see a 65% chance of another quarter point cut in December, down from an 80% chance before the election.

Several Fed officials, including Chairman Jerome Powell, will speak this week, while economic data such as the consumer price index (CPI), producer price index (PPI), weekly jobless claims and US retail sales will also be released.

In the Vietnamese market, early morning of November 12, Saigon Jewelry Company announced the price of SJC gold at 81.90 - 85.40 million VND/tael (buy - sell).

Cao Thong (t/h)

Source: https://doanhnghiepvn.vn/kinh-te/vi-sao-gia-vang-the-gioi-lao-doc-hon-2/20241112083954479