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The influence of USD strengthens led to the gold prices reduced sharply

The domestic gold price this morning (May 12) went down following the decline of the world gold price when the dollar strengthened.

At 6 am this morning, the world gold price was at $2,015/ounce, down $25 from the highest level in last night's session of $2,040/ounce.

According to analysts, gold prices fell down in context of a strong dollar as the US Federal Deposit Insurance Corporation (FDIC) proposed to charge large banks more to cover about $16 billion lost after the rescue of Silicon Valley Bank and Signature Bank in March 2023.

Issues around the US debt ceiling also undermined gold investor mentality, as Republican lawmakers were reluctant to support President Joe Biden's plan to raise the debt ceiling if he agreed to reduce government spending.

In addition, data related to inflation shows that price pressure continues to decrease when the producer price index (PPI) in April 2023 in the US only increased by 2.3%, lower than the previous and expected level of 2.7% and 2.4%. This data led many to speculate that hidden demand for gold could decline. Since then, they limit their holdings of precious metals, negatively impacting the world's gold price today.

While the precious metal fell when concerns about weakening demand grew, some market analysts said that in the longer term gold could benefit from the weakness of the US labor market. Rising unemployment increases the rate that the US Federal Reserve (FED) has ended its tightening cycle. The precious metal will also have better hidden demand if the banking turmoil heats up in the near period.

Jim Wyckoff, senior market strategist at Kitco, said that with the current situation, the Fed can reverse monetary policy.

Today's gold price in the domestic market is also adjusted down by businesses according to the trend of the world gold price.

At 9:30 am, Saigon Jewelry Company listed SJC gold price in Hanoi market at 66.6 - 67.22 million dong/tael (buy in - sell out), down 50,000 dong/tael in both ways compared to yesterday's closing session (11/5).

Phu Quy Jewelry Company listed the price of SJC gold at 66.6 - 67.2 million dong/tael (buy in - sell out), unchanged compared to yesterday's close.

At the DOJI Jewelry Group, each tael bought and sold SJC gold bars traded at 66.55 - 67.15 million dong/tael, down 50,000 dong/tael in both directions compared to yesterday's close.

At Bao Tin Minh Chau Company, the price of SJC gold bars were at 66.62 - 67.13 million dong/tael (buy in - sell out), down 50,000 dong/tael on the selling side, while the buying price was unchanged compared with the end of yesterday's session.

Source: VTVNews

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