The price of gold in international markets fell by nearly 6.6% in September, while the gap between domestic and global prices widened and the buy-sell spread remained high.
Gold closed September with a correction of 6.6% in the international market, after having maintained high prices for much of the month. Selling pressure concentrated in the final days, in a context of a stronger US dollar, rising Treasury bond yields, and fears of more persistent inflation due to rising energy costs, according to vietnam.vn.
The precious metal had reached consecutive all-time highs before this adjustment. The correction caught many investors with open positions who bought in the final stretch of the rise, attracted by the bullish trend.
In the Vietnamese market, the price of SJC gold bars fell by around 5 million dong per tael throughout September. However, the absolute drop does not reflect the whole picture: the gap between domestic and international prices widened again.
In August, this gap ranged between 3 and 5 million dong per ounce. In September, it escalated to 8 and 9 million dong per ounce, and at times the SJC bar exceeded the global gold price by more than 10 million dong per ounce.
The buy-sell spread adds another layer of risk. On October 1, the spread for SJC bars was around 3 million dong per tael, a cost that the buyer assumes from the moment they enter the market.
Financial expert Phan Dung Khanh points out that what is crucial when buying gold is to have a clear objective:
"If the goal is to accumulate and preserve assets in the long term, gold continues to play an important role as an asset to protect against inflation and economic fluctuations"
Khanh warns that if the aim is to gain in the short term, gold is not the right tool. The transaction cost borne by the buyer from day one reduces the effectiveness of speculative operations compared to other assets with greater liquidity.
Recent experience shows that when gold hits all-time highs, some buyers jump in due to herd mentality and may suffer significant losses if the market turns in just a few days.
For Spanish investors, gold continues to serve as a long-term refuge, but the volatility of September reminds us that entering at highs and the cost of the spread influence the outcome. The next reference will be the US inflation data and signals from the Federal Reserve regarding interest rates, which will determine the metal's direction in the coming weeks.
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