Gold prices may slide to Bt17,000 in 2015
LOCAL GOLD prices look set to fall to Bt17,000 per baht weight (15.244 grams) next year as they approach the end of their 15-year cycle after peaking in 2011.
“Local gold prices in 2015 are expected to be on a downtrend after climbing to Bt27,100 in 2011, the highest in 15 years,” Jitti Tansithpakdee, president of the Gold Traders Association, said yesterday.
Meanwhile, the Gold Research Centre said the Gold Exchange, which was scheduled to be set up next year, would reduce demand for gold bars, excluding gold ornaments, from retail traders, such as gold shops, as buyers or sellers of gold might shift to the exchange. That means adjustment would be needed by the retail gold traders.
Jitti said global gold prices next year would be range bound at US$1,000-$1,300 per ounce and that would result in local prices moving down to touch Bt17,000 per baht.
Another reason for falling local gold prices was the redemption of gold funds focusing on speculation.
A few factors should be closely monitored, such as the nation’s stimulus package in the short term and future interest rates.
If the policy rate was raised in a range of 0.25-0.50 percentage point, there would be no impact on local gold prices.
“However, investors should switch to short-term trading rather than long-term investment,” he said.
As for the progress in the establishment of the Gold Exchange, the association was in talks with the Agricultural Futures Exchange of Thailand (Afet) for collaboration, expecting the exchange would be ready for trading next year.
“Now that Singapore has persuaded Thai gold traders to participate in establishing a gold exchange in Singapore and offered tax privileges, this made us accelerate the setting up of a gold exchange to become a regional hub for gold,” he said.
The Gold Research Centre has supported the establishment of the Gold Exchange, as this would help set a higher standard for gold traded in the spot market. Gold trading can also be done among local parties to reduce foreign-exchange risk.
Normally, local traders deal with only foreign traders.
From the centre’s latest survey, local gold traders believe that gold prices this month would be bouncing around $1,140-$1,300 per ounce and local gold prices around Bt17,600-Bt20,000 per baht weight.
