Gold price may increase to 74 million VND/tael: Should we buy or sell now?

Domestic gold prices will continue to increase

Dr. Nguyen Tri Hieu, an economic expert, said it is very difficult to predict whether gold prices will go up or down in the near future. The gold market is an unpredictable market, affected by many issues and events.

Analyzing the reason why the world gold price is being “pushed” up, Mr. Hieu said that the US Dollar Index is falling, at one point reaching 104 points. The value of the USD has decreased, leading to an upward trend in the world gold price.

In addition, the US Federal Reserve (Fed) has opened up the possibility of not raising interest rates, because the inflation index is gradually cooling down. Inflation in October was 3.2%, equal to the inflation index in September, meaning that the US may be controlling inflation well, although it has not reached the target of 2%.

“The US not raising interest rates also reduces the attractiveness of the USD, which could be one of the reasons for the increase in gold prices. In addition, the economic situation in European countries is not optimistic, and military and political conflicts are still ongoing in the world. This creates the attractiveness of gold,” said Mr. Hieu.

In Vietnam, gold prices are on an upward trend, according to the expert, partly following the world's upward trend.

However, facing problems such as slow growth, inflation below 4% but gasoline and electricity prices on the rise, and difficulties in businesses and exports, many people run to the safe financial 'shelter' of gold.

"Domestic, stocks are down, the real estate market is not doing well, exchange rates may increase, interest rates are low and may continue to fall. Therefore, in the financial markets, gold is now more attractive than stocks, real estate, and deposits. All these factors affect the price of gold and "push" the domestic price of gold up," Mr. Hieu analyzed.

Commenting on domestic gold prices from now until the end of the year, Dr. Nguyen Tri Hieu said that domestic gold prices will continue to increase as demand for gold, especially jewelry gold, increases before and during Tet.

“The exchange rate may increase from now until the end of the year, economic activities are still slow, the Vietnamese Dong may continue to depreciate in the coming time, which will “push” the gold price up. It is difficult to predict how much the gold price will “push” up, but it is likely to increase to 74 million VND/tael,” Mr. Hieu commented.

Meanwhile, economic expert Dinh The Hien said that for a long time, the price of gold in Vietnam has been quite different from the world price. The increase in the price of gold in Vietnam depends on the world price of gold. Therefore, with the current developments, there are questions about global economic instability, the price of gold in the coming time will not increase as strongly as in the past.

“In the next 1-3 weeks, gold prices will still tend to increase but will not last more than 2-3 months, gold prices will turn around or go sideways,” Mr. Hien commented.

Should I buy or sell gold now?

When gold prices are on an upward trend, buying or selling gold at this time also needs careful consideration.

For investors with money, Dr. Nguyen Tri Hieu said that it is possible to invest in gold at this time because the price of gold is on an upward trend and will continue to increase from now until the end of the year.

“For gold investors, this may be a good time to buy gold. However, it is important to note that gold prices fluctuate very erratically. If you buy gold and save it for at least 6 months, you will make a profit; but if you surf the market at this time, it is very dangerous. People should use 1/3 of their money to buy gold, and the rest to save and invest in stocks or real estate. They should not borrow money to buy gold,” Mr. Hieu noted.

As for investors who are “holding” gold, the expert said, there needs to be a profit-taking and “loss-cutting” point. Therefore, if there is a profit-taking point of 10 or 20%, then you should sell, not wait for the price to increase further. You need to have investment discipline, have a profit-taking point, and when the profit-taking point is right, even when the gold price is rising rapidly and can continue to increase, you should still sell.

Economist Dinh The Hien noted: Gold prices change hourly, not daily. The world gold price will also reverse, and the exchange rate cannot increase further. The difference in gold prices between Vietnam and the world is quite large, so there is not much room for the difference to increase. Therefore, if you buy gold at this stage, even if the gold price reaches 75 million VND/tael, it will suddenly reverse, which is very risky.

"For those who have gold, if they sell it and deposit it in the bank with an interest rate of about 6%/year, it may still be better than "holding" that amount of gold until next year. Depositing money in the bank is also a safe channel," Mr. Hien recommended.