Gold price plummeted after US employment report, domestically “entrenched” at 74 million VND/tael

World gold prices fell sharply in Friday’s trading session, when better-than-expected employment data caused traders to reduce bets on the possibility of the US Federal Reserve (Fed) cutting interest rates in the first quarter. /2024. The domestic gold bar price this morning (December 9) decreased but still maintained the mark of 74 million VND/tael, leading to a sharp increase in the difference with the international gold price.

At closing, spot gold price decreased by 23.6 USD/oz, equivalent to a decrease of nearly 1.2%, closing at 2,005.5 USD/oz – according to data from the Kitco exchange. Gold futures price on COMEX decreased 1.3%, closing at 2,019.1 USD/oz.

During the trading session, at one point the gold price slipped from the 2,000 USD/oz mark, falling to 1,994 USD/oz for gold futures price. This week, gold prices decreased by 3.4%, marking the strongest weekly decrease in the past 10 weeks.

The November jobs report from the US Department of Labor showed that the unemployment rate unexpectedly decreased to 3.7% from 3.9% the previous month, instead of flatlining as previously forecast. The non-agricultural sector of the economy added 199,000 new jobs in the month, higher than the forecast of 190,000 jobs given by economists in a survey by Dow Jones news agency and much higher than the forecast. 150,000 new jobs in October.

The firmness of the labor market caused financial markets to reduce bets on the possibility of the Fed cutting interest rates in March, instead betting more on the possibility of the Fed cutting interest rates in May. However, the market Still firmly believes that the Fed has completed this interest rate hike cycle and will keep interest rates unchanged at its meeting on Tuesday and Wednesday next week.

Meanwhile, most economic experts predict the Fed will begin reducing interest rates in the second half of 2024 – Reuters news agency said.

“Gold prices fell as the US jobs report showed a job market that remains strong across the board,” said independent precious metals trader Tai Wong in New York. “Gold prices have fallen 150 USD/oz compared to the all-time record set earlier this week, causing the market to change expectations about the next meeting of the Fed. Gold bulls are hoping the Fed will take a softer stance so gold prices can avoid a deeper correction, if not a sell-off.”

Both US Treasury bond yields and the USD exchange rate increased after the US employment report, increasing devaluation pressure on gold.

The 10-year US Treasury bond yield increased 10 basis points, closing at 4.229%, escaping the 3-month low set in the previous session. The Dollar Index closed the session with an increase of more than 0.4%, reaching nearly 104 points, bringing the total increase for the whole week to nearly 0.7%.

“Most expectations of interest rate cuts have been reflected, so precious metal prices will be more difficult to increase in the short term if there are no new catalysts,” Saxo Bank strategist Ole Hansen said in a report. .

Current developments  world gold this week.  Unit: USD/oz.
World gold price developments this week. Unit: USD/oz.

Early this morning, Phu Quy Group listed the price of SJC gold bars for the Hanoi market at 72.8 million VND/tael (buy) and 74 million VND/tael (sell). Compared to the same time yesterday, the price of SJC gold bars at this enterprise is currently down 100,000 VND/tael at each end of the price.

Phu Quy brand 999.9 round ring is priced at 60.9 million VND/tael and 62.1 million VND/tael, corresponding to the buying and selling prices, down 300,000 VND/tael at each price compared to yesterday morning.

In the Ho Chi Minh City market, SJC Company quoted the price of gold bars of the same brand at 72.9 million VND/tael and 74.1 million VND/tael, respectively down 100,000 VND/tael and up 100,000 VND/tael.

The spot gold price closing Friday’s session was equivalent to about 58.9 million VND/tael if converted at the USD selling rate at Vietcombank, down 0.9 million VND/tael compared to yesterday.

Thus, compared to the converted world gold price, the retail price of SJC gold bars is 15.1 million VND/tael higher, while the price of gold rings is 3.2 million VND/tael higher.

USD quotes at Vietcombank closed the week at 24,020 VND (buying) and 24,390 VND (selling), down 40 VND at each price compared to Friday morning.

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