Gold prices continued to rise after market sentiment improved thanks to positive signals related to global goods and energy circulation. In the context of cooling oil prices, falling bond yields and weakening the USD, gold is regaining some of the upward momentum lost in recent months.
Mr. Alex Wolf – Global Strategy and Fixed Revenue Director at J.P. Morgan Private Bank said that many unfavorable factors that once put pressure on gold are gradually weakening.
I think recent developments are a positive catalyst for gold because many unfavorable factors that have appeared in the past time are starting to reduce their impact," he said.
According to Mr. Wolf, factors putting pressure on gold in the past include high energy prices, escalating bond yields, stronger USD and reduced gold buying demand from some investor groups.
As these pressures subside, long-term drivers of gold such as buying activity from central banks, the trend of reserve diversification and stable demand from Asia are expected to continue to support the market.
This assessment is also similar to Barclays' latest report. The bank believes that the sharp drop in gold prices in recent months mainly stems from the rising USD, rising bond yields, and strong cash flow into the stock market.
According to the research group of Barclays - a multinational investment and financial services bank in the UK led by Mr. Lefteris Farmakis and Mr. Themistoklis Fiotakis, gold prices fell sharply not because of weakening long-term fundamentals but mainly due to changes in interest rate expectations and investor profit-taking activities.
Barclays estimates that the USD appreciation alone and the S&P 500 index increasing by about 10% have contributed to a significant drop in gold prices in the past time. The rest comes from leverage reduction and portfolio restructuring in the precious metals market.
However, this bank believes that long-term supporting factors for gold are still intact, including high inflation, demand for gold from central banks and the trend of diversification of reserve assets.
Barclays experts assess that these are factors that have accumulation effects over time and will continue to exert influence as short-term pressures on the market gradually decrease.
Notably, Barclays believes that each percentage point increase in inflation can help gold prices increase by about 5%. This bank currently estimates the fair value of gold at about 4,150 USD/ounce and expects prices to continue to recover in the near future.
Barclays maintains its average gold price forecast in 2026 at 4,791 USD/ounce and in 2027 at 4,900 USD/ounce.
However, this organization also noted that gold prices may still experience short-term corrections as investors continue to monitor the monetary policy of the US Federal Reserve (Fed).
At the trading session at 10:15 am Vietnam time, spot gold price increased by 0.02% to 4,330.82 USD/ounce. Silver price increased by 0.4% to 70.30 USD/ounce. Meanwhile, platinum and palladium also recorded price increases, while the USD index decreased by 0.1%.
