According to Golden Finance, on the morning of June 9th in the Asian session, the spot gold market experienced a sudden change in its situation, encountering a selling spree. The price plunged rapidly like a high platform, breaking through the key support level of $3,300 per ounce in one fell row. As of the time of relevant data statistics, the intraday decline has reached 0.35%. This sudden change has drawn widespread attention from the market, and many financial media have focused on reporting on it.
According to data from Tonghuashun Futures Connect, in the spot market of precious metals, the latest price of London gold spot is $3,307.11, down $10.86 from the previous trading day, or 0.33%. In the domestic market, the price of gold T+D has also declined. The latest price is 767.46 yuan per gram, down 12.94 yuan from the previous day, representing a decline of 1.66%. In terms of physical gold, the prices in gold stores generally dropped. The price of Chow Tai Fook gold was 998.0 yuan per gram, a decrease of 0.70% compared to yesterday. The price of Chow Tai Seng gold was 1,005.0 yuan per gram, down 1.47% compared with yesterday. The gold price of Lao Feng Xiang is 1,00.0 yuan per gram, down 0.30% compared with yesterday, etc. The price of investment gold bars at banks also declined. The price of investment gold bars at the Construction Bank was 780.90 yuan per gram, down 0.27% compared with yesterday. The price of the Industrial and Commercial Bank of China’s Ruyi Gold Bar is 785.22 yuan per gram, down 0.01% compared with yesterday, etc.
Analyzing the reasons behind the recent sharp drop in gold prices can be described as extremely complex. Global tariff negotiations have made breakthrough progress, easing market risk aversion to a certain extent. In the past, when the global trade situation was tense, gold, as a safe-haven asset, attracted a large amount of capital inflows, driving the price to keep rising. Nowadays, trade tensions have eased, and investors’ demand for safe-haven assets has declined, hitting the price of gold. Recent US non-farm payroll data has sent out contradictory signals. The number of new jobs added has exceeded expectations, but the unemployment rate has risen and the growth rate of hourly wages has significantly increased, which has intensified market concerns about inflation. On the one hand, the new employment was better than expected, indicating that the economy has certain resilience and reducing the market’s reliance on gold as a safe haven. On the other hand, the unemployment rate and the growth rate of hourly wages have left the market confused about the future economic outlook and the trend of inflation. Investor sentiment has become more volatile, and the forces of bulls and bears are fiercely competing in the market, which has a direct impact on the gold price.
From the perspective of the overall market trend, since May, the gold price, which has repeatedly set new historical highs, has embarked on a more intense roller coaster ride. Over the past two weeks, the international gold price has gradually fallen below the thresholds of $3,500, $3,400 and $3,300 per ounce. Although there were price rebounds during this period, such as the international gold price soaring again to break through $3,350 per ounce on May 21st, the overall trend was volatile and downward. Against the backdrop of the Federal Reserve’s upcoming June interest rate decision, the future trend of the gold market is full of uncertainties. If the Federal Reserve sends hawkish signals, maintaining high interest rates or hinting at the possibility of future rate hikes, the opportunity cost of holding gold will increase, which may further depress the gold price. Conversely, if the Federal Reserve takes a dovish stance, it may provide support for the gold price. At present, all market participants are closely monitoring the movements of the Federal Reserve. Investors also need to be cautious in dealing with the significant fluctuations in gold prices and adjust their investment strategies reasonably.
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