Bangkok: Gold prices have experienced a significant drop, falling by 3,200 baht, following the announcement by US President Donald Trump that Kevin Warsh will be the new Federal Reserve chairman. This announcement triggered a wave of profit-taking among investors. The market currently anticipates that gold prices could recover to approximately $5,000 per ounce within the week.
According to Thai News Agency, gold prices have exhibited considerable volatility over the past week. On Thursday, Thai gold reached a new peak, increasing by over 4,000 baht in a single day. However, a sharp decline followed on Friday, with prices plunging by 7,300 baht per baht of gold, reflecting the global market's 10% drop in a single day - the steepest decline observed in 46 years. This downward trend persisted through the weekend.
The week commenced with a continued decrease in gold prices, with an initial drop of 1,650 baht. The buying price for gold bars was recorded at 72,350 baht per baht weight, while the selling price stood at 72,550 baht per baht weight. Gold jewelry was priced at 70,903.32 baht per baht weight for buying and 73,350 baht per baht weight for selling. Meanwhile, the Gold Spot price was reported at 4,857 US dollars per ounce.
As of 11:10 AM, gold prices have adjusted 13 times. The current buying price for gold bars is 70,800 baht per baht weight, with the selling price at 71,000 baht per baht weight. Gold jewelry is being bought at 69,387.032 baht per baht weight and sold at 71,800 baht per baht weight. Concurrently, the Gold Spot price has decreased to 4,775 US dollars per ounce.
Analysts have attributed the steep decline in gold prices largely to the announcement regarding Kevin Warsh's appointment as Federal Reserve chairman. The news strengthened the dollar, as market participants anticipate that Warsh might implement a tighter monetary policy than expected. Additionally, recent economic data has supported the dollar's appreciation, prompting both institutional and retail investors to sell off their gold and silver holdings, further depressing prices.
Looking ahead, a weekly poll by Kitco News reveals divided opinions among Wall Street analysts on the future of gold prices. While 39% foresee a recovery to $5,000, another 39% predict continued corrections. Retail investors remain optimistic, with 73% expecting gold prices to rise this week. Analysts advise caution, highlighting that market volatility is likely to persist. Investors are encouraged to watch upcoming US non-farm payroll data and central bank decisions closely, as these could influence short-term price movements.
Mr. Jitti Tangsitphakdi, President of the Gold Traders Association, forecasts a potential 40% increase in global gold prices this year, potentially reaching $6,030 per ounce. Should the Thai baht maintain a rate of 31 baht per dollar, domestic gold bar prices could approach 88,400 baht per baht. However, Mr. Tangsitphakdi cautions investors about the high risks associated with short-term investments due to the rapid price fluctuations and recommends long-term holdings for better profit opportunities, while alerting to potential losses during price corrections if timing is not optimal.