Local gold traders say global prices remain on course to reach US$2,500 per ounce in the second half of 2024, after slipping below $2,300 recently, although the market lowered expectations for US interest rate cuts to a maximum of two times this year, down from 3-4 earlier.
Jitti Tangsithpakdi, president of the Gold Traders Association, pointed to continuous buying of the precious metal by global central banks to support this optimism, as gold is currently in tight supply.
"Earlier we anticipated the Federal Reserve would lower the US rates three to four times and drive global prices to $2,500 an ounce late this year," he told the Bangkok Post.
"Now one or two reductions is more likely, and we anticipate gold should definitely top $2,400, and possibly hit $2,500."
Mr Jitti's comments came as spot gold held its ground at $2,299.49 per ounce on Friday after losing more than 1% last week, as US gold futures were flat at $2,309.20.
Prices have fallen more than $130 after hitting a record high of $2,431.29 in April.
"The recent price losses were driven mainly by panic selling, especially from people who bought gold futures for speculation. Now we are seeing a key support level of $2,275," he said.
Cholathis Nualplab, head of research at Hua Seng Heng Gold Futures, agreed with Mr Jitti that the price could hit $2,500 later this year following recent consolidation, absent a new global factor.
"Investors have started to become concerned about stagflation in the US after inflation has not eased and the Fed said it has no plans to hike interest rates," he said.
"Although Fed chair Jerome Powell dismissed talk of stagflation, saying the central bank has not seen any signs, investors don't seem convinced and wonder about the next Fed step if inflation stays stubbornly high for a long period."
The domestic price of gold was quoted at 40,100 baht per baht-weight on Friday afternoon after eight price adjustments, losing 150 baht from a day earlier, with gold jewellery settling at 40,600 baht.
The baht rose to more than 36.8 against the greenback, advancing from 37.20 baht, which is one factor stopping domestic gold prices from sliding much.