Gold prices fall 800 baht amid Trump’s election victory
Gold prices have shown potential for a long-term rise, despite experiencing a significant drop yesterday. The domestic price plummeted by 800 baht (US$23.5) per baht weight, largely due to the strengthening of the US dollar following the recent presidential election victory of Republican Donald Trump.
The Gold Traders Association (GTA) reported that domestic gold prices sank to 43,150 baht (US$1,267) per baht weight. This decline followed a dip in global prices triggered by the election outcome, which spurred changes in US economic and political policies, leading to a stronger dollar and subsequently affecting bullion.
Hua Seng Heng Gold Futures highlighted that the global gold market saw a slip below US$2,700 an ounce, a decrease of US$85, marking a reaction to Trump becoming the 47th US president. Spot gold was recorded at US$2,657.65 per ounce after reaching its lowest since October 15 earlier in the trading session.
The price of bullion, which had previously hit a record high of US$2,790.15 last week, has since seen a drop of over US$130. US gold futures also experienced a decline, shedding 0.4% to US$2,665.20, noted a gold trader in a recent research note.
“The Republican Party’s policies are expected to improve US economic growth, causing the dollar to strengthen the most in four months, which is a negative factor for gold prices.”
While the ballot count is still underway, Republicans appear poised to secure a majority in both the Senate and House of Representatives, potentially resulting in a more stable political climate in the US, according to Hua Seng Heng.
The trader anticipates that gold prices may continue their downward trajectory in the short term. However, Hua Seng Heng suggests that Trump’s policies could eventually exert a positive influence on gold, leading to a rebound and surge in prices over the longer term, reported Bangkok Post.
“However, Trump’s policies are expected to have a positive effect on gold in the long term, driving gold prices to rebound and surge after this,” stated Hua Seng Heng.
Investors are advised to consider purchasing domestic gold bars at the support levels of 43,150 and 43,000 baht (US$1,267 and 1,263), as recommended by the trader.
