BANGKOK, April 18 – The plunging gold prices which caused panic selling in the Thai bullion market after the long Songkran holiday will gradually inch up at a minimal level, according to analysts at the Gold Research Centre.
Kamonthan Pornpaisarnvijit said more than 200 tonnes of gold have been sold in the global market since early this year, reflecting fragile investor sentiment and signaling a bear market.
More than that, several other factors have contributed to dropping gold prices, a possible sell off by the Cyprus central bank, the predicted termination of US liquidity measures, and inflation volatility due to sagging economic growth of emerging countries especially China.
Phusit Wonglorsaichon said the swift slide of gold prices in the last several days was not unpredicted but the fall was unexpectedly sharp and abrupt, from US$1,561 per ounce to $1,477 per ounce – $84 or 5.4 per cent lower – in just one day last Friday.
The price nosedived by $125 or 8.5 per cent to close at $1,352 on Monday.
The gold price dropped by $209 or 13.4 per cent in only two days. Compared to last October when gold price was at $1,781, its value has plunged by $429 or 24.1 per cent.
The phenomenon has resulted in a short-term psychological impact among investors who had rushed to buy the yellow metal, while the Thai bullion market also witnessed panic selling, Mr Phusit said.