From the beginning of 2020, the gold price has increased to 750 thousand dong/tael. Up to 80% of Main Street investors believe that gold will increase in this year, many people think that gold will even surpass the historic peak in 2011 and touch 2,000 USD/ounce.
The gold market started the new year 2020 with a continuous increase due to escalating geopolitical uncertainties, which made the demand for safe investment increase. Price is currently at the 4-month high at over 1,552 USD/ounce.
In a survey last weekend about the future of gold prices, investors participating in the Main Street survey of Kitco News agreed that gold prices will continue to increase throughout the year.
Specifically, out of 1,749 respondents, 80% of the respondents said that the price of gold would continue to rise, at least to reach over 1,600 USD/ounce by the end of 2020. 25% of respondents, or 439, are even optimistic about the future of gold prices and they believe that this precious metal will surpass the historic peak of 2011 when it reaches over 2,000 USD/ounce at the end of the year.
In the group forecasting a decline in prices, only less than 9% of the respondents said that gold prices will fall and end 2020 at a lower level than currently. Only less than 1% of the forecast gold price will drop below 1,000 USD/ounce.
Earlier in 2019, a Kitco News survey showed that about one-third of respondents forecast gold prices to end the year at $ 1,500 per ounce.
And the fact that last year's gold price rose 19% and ended the year at $ 1,523 an ounce due to the global monetary easing policy combined with fears of an economic downturn are making the demand for investments safe assets, including gold, to rise.
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Although Wall Street investors believe that gold prices will rise sharply, other international financial institutions are less optimistic about the prospect of this precious metal even though they also predict price increases. For example, Goldman Sachs, ABN AMRO, TD Securities forecast that gold price will increase only to around 1,600 USD/ounce.
As argued by Goldman Sachs in a strategic report in November 2019, the central bank bought 750 tons of gold, combined with the depreciation of the dollar and the shift in the defensive portfolio last year, gold price this year will increase but only around $ 1,600 per ounce. Several other investors said that, although the US Federal Reserve will keep interest rates at current levels, this low-interest rate area will not have many opportunities for rising inflation as well as the possibility of a potential reduction in interest rates. Therefore, gold will be an asset does not bring much profit. For many people, gold now plays an insurance role in their portfolios.
In the country, the gold price last year increased by nearly 6 million dong/tael, equivalent to 16.3% of value - higher than the happenings of the stock market and more than 2 times higher than savings in banks. Many people did not expect gold to rise so high.
In the early days of 2020, due to escalating geopolitical tensions in the Middle East, the world gold price continued to rise sharply, dragging domestic gold up. As of January 6, the gold price has reached 43.3 - 43.6 million VND/tael - the highest area in the last 6 years and has increased by 750 thousand VND/tael compared to the end of 2019.
If the prediction of Main Street investors is correct, that gold will increase the price to at least 1,600 USD/ounce by the end of this year, the domestic gold price will be approximately 45 million VND/tael (converted at the current exchange rate at VND 23,230/USD), and if the price is up to USD 2,000/ounce as 25% of the above opinion, the domestic gold price will be not less than VND 55 million/tael.
Read more: Will Gold Price Increase By The End Of 2020?