World gold prices increased for 2 consecutive months thanks to new expectations about interest rates

World gold prices went down in the last trading session of November but completed the second consecutive month of increases thanks to expectations that the US Federal Reserve (Fed) will soon begin cutting interest rates in 2024. Price Domestic gold this morning (December 1) was stable, in which the price of gold bars continued to differ by more than 13 million VND/tael compared to the international converted price.

At nearly 10:00 a.m., Phu Quy Group listed the price of SJC gold bars for the Hanoi market at 72.4 million VND/tael (buying) and 73.6 million VND/tael (selling). Compared to yesterday morning, the price of gold bars at this business is currently down 100,000 VND/tael at each end of the price.

Phu Quy brand 999.9 plain round ring is quoted at 61.55 million VND/tael and 62.85 million VND/tael, respectively, buying and selling prices, down 150,000 VND/tael and 100,000 VND/tael compared to yesterday. via.

In the Ho Chi Minh City market, SJC Company quoted the price of gold bars of the same brand at 72.4 million VND/tael and 73.6 million VND/tael, down 100,000 VND/tael at each price.

At the same time, the spot price of gold in the Asian market stood at 2,042.7 USD/oz, up 6 USD/oz compared to Thursday’s closing session in the US market, equivalent to an increase of 0.3% – According to data from the Kitco exchange. This price is equivalent to nearly 60.2 million VND/tael, equal to the level of yesterday morning.

Compared to the converted world gold price, the retail price of SJC gold bars is 13.4 million VND/tael higher, while the price of gold rings is about 2.7 million VND/tael higher.

Last night’s session in New York, spot gold price decreased by 6.9 USD/oz, equivalent to a decrease of 0.34%, closing at 2,036.7 USD/oz – according to Kitco. But in November, world gold prices increased by 2.7%.

Gold prices fell as US Treasury bond yields and the USD exchange rate increased in the last trading session of November. The yield on the 10-year term increased slightly to 4.34%, while the Dollar Index closed at level of 103.5 points, from 102.8 points in the previous session.

However, in November, both US Treasury bond yields and USD exchange rates fell sharply, paving the way for gold prices to increase. This week, at one point the 10-year US Treasury bond yield hit its lowest level in 2 and a half months while the USD exchange rate fell to its lowest level in 6 months. The reason is that investors believe that with the decline in inflation, the Fed will not have to raise interest rates any further and will begin cutting interest rates at some point in the first half of 2024.

US Treasury yields have fallen from a 16-year peak of 5% at the beginning of the month, while the Dollar Index fell 1.65% in November, marking the sharpest monthly decline since the beginning of the year – according to data from the website. MarketWatch.

Current developments  world gold in the past month.  Unit: USD/oz.
World gold price developments in the past month. Unit: USD/oz.

Statistical data from the US Department of Commerce on November 30 showed that the core personal consumption expenditures price index (PCE) increased by 3.5% in October compared to the same period last year, decelerating from an increase of 3.7%. recorded in October and lower than the forecast of a 3.7% increase previously given by analysts. Core PCE, which excludes food and energy prices, is the Fed’s favored measure of inflation and has a major influence on the central bank’s interest rate decisions.

The above data points add to the series of positive data on inflation in the US published in the past month – the basis for investors to believe that there will soon be a shift in monetary policy towards a softer direction.

“Gold prices seem to have leveled off after a period of strong increases. If there is a decrease, gold prices will be supported in the area of ​​2,015-2020 USD/oz, and there will be nothing to worry about an uptrend unless the price falls below 2,000 USD/oz,” said New York-based trader Tai Wong. spoke to Reuters news agency.

According to data from CME’s FedWatch Tool, traders are betting on an 80% chance of the Fed cutting interest rates in May and a 50% chance of the Fed lowering interest rates in March.

“We forecast gold prices will break out to new highs in the first half of 2024 as the Fed moves toward a pivot and the economy may slow,” TD Securities strategist Daniel Ghali told Reuters.

However, the world’s largest gold exchange-traded fund (ETF) SPDR Gold Trust became a strong net seller again this week. On Thursday session, the fund sold a net of 2 tons of gold, reducing its holdings to 876.5 tons of gold. All week, the fund discharged more than 6 tons of gold.

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