Compared to the beginning of the week, world gold prices recorded a positive increase of nearly 15 USD/ounce to 1830 USD/ounce. In the domestic market, SJC gold bar prices increased in both buying and selling directions, from VND 100,000 and VND 200,000 to VND 61.15 - 61.85 million/tael.
"The US stock market and the cryptocurrency market are under selling pressure, cash flow will have to flow into other channels," said senior strategy analyst Frank Cholly of brokerage RJO Futures.
Everett Millman - Precious metals expert at Gainesville Coins - said that gold's move surprised some analysts because the speed of the event was so fast.
"The gold market has been moving sideways for many months, this breakout is quite surprising. Entering next week, the sentiment in the gold market will be quite negative as many major banks predict prices may go down," said Ms. Millman.
In addition, rising oil prices and strong retail demand have contributed to pushing gold prices higher.
"Higher oil prices make gold mining more expensive," Millman said. We can see limitations in exploiting gold supply. In addition, real demand for gold remains strong. The US money laundering department has seen its highest gold sales in 12 years, while Perth mint recorded its highest in 10 years. Retailers are still buying gold at the fastest pace in 10 years."
All eyes are on how the markets will react to the Federal Reserve's monetary policy meeting next week. Mr. Cholly predicts that the US stock market will experience an increasingly strong sell-off as the central bank maintains the old-fashioned "hawl" view.
"We could see a correction that has a big impact on stocks. Next week, gold's strength will depend on a decline in stocks and a flow of reallocation to precious metals," Cholly pointed out.
If gold prices surpass the 1,850 USD/ounce mark, it will open the door to reach the 1,870 - 1880 USD/ounce mark and eventually 1,900 USD/ounce.
The focus next week will be the Fed meeting and Chairman Jerome Powell's press conference. Analysts expect more clues about the first rate hike in March and more clarity on the accounting balance sheet. Currently, markets are pricing in 4 interest rate increases in 2022.
ING Bank economist James Knightley said there is a risk that the Fed will become even more "a++" by announcing the completion of the asset purchase cut process immediately.
In an environment where the economy has fully recovered from the pandemics declining output, unemployment has returned below 4% and inflation is at its highest level in nearly 40 years, continuing to package economic stimulus seems strange, Mr. Knightley analyzed.
Important data to be released by the US next week include the consumer confidence index (CB), the GDP index for the fourth quarter of 2021, the personal consumption index (PCE), and the unemployment data.
