Thai Gold Expert Warns of Severe Correction as Prices Surge 40% Amid "Everything Rally"

Thailand's gold market is experiencing unprecedented euphoria as prices have surged past 60,000 baht per baht weight, but industry experts are warning that the rally shows dangerous signs of excess that could precede a sharp correction.

 

Teerarat Jutavarakul, managing director of InterGold Trade, told the "Thailand Economic Outlook 2026: Out of the Trap" seminar hosted by Krungthep Turakij on Thursday that gold has become the "talk of the town" as prices have climbed more than 40 per cent in baht terms this year—an increase of roughly 20,000 baht since January that he described as extraordinarily unusual for a single year.

 

In US dollar terms, the metal has appreciated 50 per cent, driven primarily by its safe haven status amid mounting global instability, geopolitical conflicts, and concerns over dollar debasement as investors flee what they perceive as excessive US debt and monetary expansion.

 

However, Teerarat cautioned that the market is exhibiting characteristics reminiscent of previous bubble episodes, particularly the simultaneous rally across multiple asset classes including US equities, gold, and Bitcoin—all reaching new all-time highs concurrently.

 

"This pattern is rare but has historical precedents, such as during the dot-com bubble leading up to 2000," he said, noting that such synchronised spikes have historically been followed by market collapses and economic recessions.

 

 

Technical indicators are flashing warning signals, with the Relative Strength Index recently hitting 91 out of 100, suggesting the asset is heavily overbought.

 

Whilst this does not guarantee an immediate downturn, Teerarat warned that when a correction occurs, it will likely be severe.

 

"A price correction of 5,000 baht is not difficult given the asset's rapid 20,000 baht surge over the past 10 months," he said, noting that a similar 4,000 baht drop occurred during the first half of this year.

 

The expert pointed to excessive positive sentiment amongst investors who are overlooking the necessity of consolidation.

 

He revealed that InterGold clients have been net buyers every day over the past week, indicating potentially frothy market conditions.

 

Historical precedent suggests gold is not immune to sharp declines even during its role as a safe haven.

 

 

 

During the 2008 financial crisis following the Lehman Brothers collapse, gold experienced a severe drop alongside equities, though it recovered more quickly.

 

Despite short-term volatility risks, Teerarat emphasised gold's long-term fundamentals remain sound, supported by its limited supply, inflation-hedging properties, and status as a safe haven that cannot be printed by central governments.

 

A key indicator to monitor is the purchasing behaviour of China's central bank, which has publicly reported buying gold for 11 consecutive months.

 

However, the volume has been steadily decreasing—from 10 tonnes to 8 tonnes, and most recently just 1 tonne.

 

"The month when China announces it has ceased buying gold may mark a turning point in the price trend," Teerarat suggested.

 

For new investors considering entry, he advised they must be prepared to accept the risk of a sudden correction of 4,000 to 5,000 baht if they intend to hold for the long term of five years or more.