Looking back at world gold prices last week
Gold prices have just experienced a week of strong fluctuations when the upward momentum at the beginning of the week was quickly reversed. The weakening USD and prolonged concerns about the US fiscal situation once created support for the precious metal, but the tough statement of US Federal Reserve (Fed) Chairman Kevin Warsh at the Jackson Hole conference has caused the market to change expectations about monetary policy. The possibility of the Fed raising interest rates in September is once again being considered by investors.
Spot gold opened the week around 4,618.79 USD/ounce on Sunday evening (US Eastern time). On Monday's session, prices continued to rise as investors assessed the impact of the US Treasury bond repurchase plan previously announced, especially on long-term yields, US public debt sustainability and the need to hold tangible assets.
The upward momentum was extended to Tuesday. Less positive signals from consumer confidence, along with position adjustments before a series of US growth and inflation data was released, helped gold prices set a weekly peak at 4,697.66 USD/ounce.
However, the upward trend began to weaken from Wednesday morning. Core PCE inflation data and Q2 GDP did not significantly change the market's assessment that the US economy still maintained its resilience, while inflationary pressure remained high.
Bond yields rose, causing gold to quickly fall below the 4,600 USD/ounce mark. Traders also became more cautious before Fed Chairman Kevin Warsh's speech at Jackson Hole.
Selling pressure increased sharply on Thursday as expectations of the Fed raising interest rates increased, the USD strengthened, and short-term US Treasury bond yields rose. These are all unfavorable factors for gold - a non-performing asset.
Spot gold prices at one point fell to 4,566.17 USD/ounce on Thursday. However, buying pressure then returned, bringing the precious metal to a strong recovery to 4,631.98 USD/ounce at the beginning of Friday's session.
The recovery did not last long. The "hawkish" message from the Fed Chairman at Jackson Hole quickly turned market sentiment negative. Gold prices fell more than 1% in just a few hours after the speech.
Spot gold finally fell to the bottom of the week at 4,445.4 USD/ounce right before 3 pm US Eastern time.
Gold price forecast for next week
The latest weekly gold survey by a precious metals website shows that Wall Street analysts still maintain a relatively positive sentiment towards gold, even after a sharp drop in the last session of the week. Meanwhile, the level of optimism of individual investors has decreased compared to the previous week.
This week, 21 analysts participated in the survey. Viewpoints on Wall Street are quite divided, but the group forecasting gold price increases still accounts for the highest proportion.
10 experts, equivalent to 48%, believe that gold prices will increase next week. Six people, accounting for 29%, forecast that the precious metal will continue to decrease. The remaining five experts, equivalent to 24%, believe that gold prices may move sideways, accumulating around a new low level or believe that the factors affecting the market are currently quite balanced.
In the group of individual investors, the online survey attracted 207 votes. Optimistic sentiment still prevailed, but declined after gold prices faced strong selling pressure at the end of the week.
There are 121 investors, equivalent to 59%, expecting gold prices to recover next week. Meanwhile, 44 people, accounting for 21%, forecast that gold prices will continue to fall. The remaining 42 investors, equivalent to 20%, believe that the market will mainly trade sideways.
The article only reflects market developments and opinions, forecasts, not investment recommendations. Investors need to consider carefully before making a decision.
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