The Ever-Climbing Gold Price: How High Can It Go?

Gold Prices Could Continue to Rise

On the morning of August 9th, gold bar prices were steady from the previous trading session, with buy-in and sell-out rates at 123.2 and 124.4 million VND per tael, respectively. Experts predict a potential upward trend for gold in the coming period.

According to PGS.TS Nguyen Huu Huan from the University of Economics Ho Chi Minh City, multiple factors could push gold prices higher. The US labor market is weaker than expected, increasing the likelihood of Fed rate cuts and driving gold prices higher.

“The US economy is weakening, and the impact of tariffs and Donald Trump’s policies has raised expectations that the Federal Reserve (Fed) will cut interest rates soon to support the economy. As a result, gold prices will surge,” Huan stated.

He added, “It’s challenging to predict gold prices at the moment as they fluctuate between $3,300 and $3,400 per ounce. To establish a new upward trend, it needs to surpass the $3,500 per ounce mark. Currently, gold prices are ranging within a wide fluctuation band, indicating that both decreases and increases can be sharp.”

Sharing a similar view, financial and banking expert, Dr. Nguyen Tri Hieu, forecasted that domestic gold prices would surpass 124 million VND per tael.

“It is possible that domestic gold prices will reach the 130 million VND per tael mark, but the timing is uncertain. However, gold prices could reach the 125 million VND per tael level within the next two to three months,” he said.

Dr. Hieu attributed the recent volatility in global gold prices mainly to short-term trading activities by investors.

The surge in global gold prices has prompted investors to sell and take profits, causing short-term downward pressure. Nonetheless, the mid to long-term outlook remains bullish.

Complex geopolitical issues and US tariff policies continue to provide upward momentum for global gold prices, according to Dr. Hieu.

Tran Duy Phuong, an expert, also predicted that it was only a matter of time before domestic gold prices reached new highs.

Analyzing the global situation, Phuong stated that gold prices are in an upward adjustment phase towards the $3,400 per ounce level but are likely to drop again afterward. However, domestic gold prices are influenced not only by global prices but also by the lack of additional gold material imports for production, making significant price drops unlikely.

“Domestic gold prices are somewhat independent and only partially follow global prices. They are influenced by domestic demand, while the market faces a shortage of supply. Therefore, even if global gold prices drop sharply, their impact on domestic prices will be limited,” Phuong explained.

What Should Investors Do?

Dr. Nguyen Tri Hieu advised that gold investment should be approached with a medium to long-term perspective. Short-term speculation in a highly volatile market, like the current one, carries considerable risk.

When gold prices surge, investors tend to sell and take profits, causing short-term corrections. Therefore, long-term holding aligns better with gold’s nature as a defensive asset with minimal risk.

According to Dr. Hieu, each investment channel has its strengths. Decisions regarding the gold, stock, and real estate markets or bank deposits should be based on both quantitative and qualitative assessments rather than impulsive actions.

For the present, Dr. Hieu recommended that investors maintain a balanced asset allocation. Keeping one-third of their assets in cash at banks is advisable for risk management and flexibility. The remaining funds should be evenly distributed between gold and stocks, currently the most attractive investment channels.

“Currently, domestic gold bar prices are significantly higher than global prices, with a difference of 16-17 million VND per tael. If necessary, instead of rushing to buy gold bars, individuals can consider purchasing gold rings, which are closer to global prices and thus carry less risk.

For those accumulating gold as a long-term asset, a well-planned timeline for purchases is essential. Avoid short-term gold speculation using financial leverage or reacting to rumors, especially in an opaque market regarding actual supply and demand,” Dr. Hieu cautioned.

Nguyen Quang Huy, CEO of Finance and Banking at Nguyen Trai University, advised investors that gold price movements are intricate and unpredictable, especially in the short term. Therefore, gold investment entails substantial risk for those with short-term goals or traders.

In the long run, investing in gold is feasible but should not exceed 10% of one’s total asset portfolio, according to Huy. The remaining capital should be allocated efficiently to other potential profit streams suited to individual preferences, such as business ventures, startups, or stocks in well-founded companies benefiting from economic trends.

Additionally, funds can be deposited in savings accounts or invested in affordable real estate with practical applications.

“Gold remains a crucial safe-haven asset, but it is not the optimal investment choice for everyone. Short-term investors should avoid FOMO (fear of missing out) and buying at peak prices, as this could lead to significant corrections,” Huy warned.

“For long-term investors, holding a reasonable proportion of gold in their portfolio is sensible, but they should not have excessive expectations. Instead, diversifying assets to optimize profits and minimize risks is recommended,” he concluded.