Gold Price Today: Market Expects Next US Central Bank Monetary Policy

The gold price on the international market increased sharply on September 20, 2024, as the market anticipates the next monetary policy of the US Central Bank.

As of 9:00 p.m. (September 19, Vietnam time), the gold price on the Kitco floor was trading at $2,576.6 per ounce, up 0.69% compared to the beginning of the session. Meanwhile, the gold futures price for December 2024 delivery on the Comex New York floor was trading at $2,612.4 per ounce.

The world gold price turned to increase strongly again after plummeting from its peak at the beginning of the US market trading session. This surge follows the US Federal Reserve’s (Fed) decision to cut interest rates by 50 basis points.

Analysts attribute the sudden upturn in gold prices to investors’ growing optimism about the Fed’s monetary policy in the coming time. The Fed’s decision to cut interest rates marks the beginning of a broader monetary policy easing cycle by the US Central Bank, which is expected to lead to 1-2 more interest rate cuts this year.

Adam Button, Head of Currency Strategy at Forexlive, predicts that based on recent economic developments in the US, the Fed is likely to cut another 25 basis points in November and December.

Historically, interest rate-cutting cycles have driven higher investor demand for gold. However, this time around, central bank demand, especially from China and India, has been strong, giving the gold market an edge over other investment vehicles, according to Robert Minter, chief investment strategist at Abrdn.

In the domestic market, at the end of the session on September 19, the price of 9999 gold bars at SJC was 79.8 million VND/tael (buy) and 81.8 million VND/tael (sell). SJC listed the price of gold rings at 77.9-79.2 million VND/tael (buy – sell).

Doji Hanoi listed at 79.8 million VND/tael (buy) and 81.8 million VND/tael (sell). Doji Ho Chi Minh City bought SJC gold at 79.8 million VND/tael and sold at 81.8 million VND/tael.

Gold Price Forecast

Mr. Robert Minter predicts that in the new easing cycle, it is only a matter of time before gold surpasses the $3,000 per ounce mark.

Julia Khandoshko, CEO of European brokerage firm, forecasts that in the long term, a 50 basis point interest rate cut will boost gold prices strongly. Lower interest rates will be the main driver for gold prices to reach $3,000 an ounce.

ANZ analysts forecast gold prices to rise to $2,900 an ounce by the end of the year after seeing lackluster investment demand in the first half of 2024. Higher prices are unlikely to deter central bank buying.