The Zhitong Finance app learned that Wind data showed that as of the close of trading on December 1, the intraday price of COMEX gold once reached 2095.7 US dollars/ounce, and finally closed at 2091.7 US dollars/ounce, setting a new historical record. Spot gold was reported at 2071.29 US dollars/ounce by the close, and is also approaching the highest price of 2079.37 US dollars/ounce on May 4 this year. According to market analysis, the price of gold is rising. On the one hand, the US dollar index and US Treasury bond yields have declined; on the other hand, the volume of gold purchases by central banks has reached a record high since this year. Related concept stocks: Zijin Mining (02899), Datang Tongjin (08299), Lingbao Gold (03330), Zhaojin Mining (01818).

On December 01, the US dollar index fell. As of the end of the New York foreign exchange market, the US dollar index, which measures the US dollar against the six major currencies, fell 0.23% on the same day, and closed at 103.266. Furthermore, in the intraday period on December 1, the yield on US 10-year treasury bonds once hit 4.198%, and finally closed at 4.203%, the lowest level since September this year.

Analysts believe that as the US CPI and retail sales data for October both declined, the market's trust in the Fed's policy outlook declined, and once again became convinced of the end of the interest rate hike cycle. The enthusiasm of aggressive investors to begin the pace of interest rate cuts in the first half of next year has also been reignited. The decline in both US dollar and US bond yields has created some of the best scenarios for gold.

Everett Millman, chief market analyst at Gainesville Coins, said, “Gold is experiencing an increase, and this situation is expected to continue until the end of this year. There is definitely a possibility that spot gold prices will hit historic highs again.”

In addition to interest rates on US bonds, Wu Guoqing, fund manager of Qianhai Open Source Fund, said that the continued purchase of gold by central banks is also an important driving force for the rise in gold prices. According to statistics from the World Gold Council, net purchases of gold reserves by central banks around the world surged by 80% in 2021, and against the backdrop of overall pressure on gold prices in 2022, they bucked the trend and surged by 167%. The annual net purchase volume reached 1135.7 tons, the second highest in history after 1968. The latest Gold Council research shows that most of the countries surveyed will continue to increase their gold reserves over the next year. Currently, central bank purchases account for 25% of the gold market, and will become an important driver for the rise in gold prices.

According to the global gold demand trend report for the third quarter of 2023 released by the World Gold Council, gold demand in the third quarter (including OTC transactions) was 1,267 tons, the highest in the past three years. The World Gold Council said that central banks are expected to maintain strong demand for gold purchases for the rest of this year, which indicates that the total demand for gold purchases from central banks is expected to remain strong throughout 2023.

Furthermore, Wu Guoqing also mentioned that in recent years, many countries and regions have seen an accelerated de-dollarization trend in the field of settlement currency. Although the US dollar still accounts for nearly 50% of the global settlement currency, with the gradual decline in the strength and creditworthiness of the US country, as well as the multipolarization, regionalization, and antagonism of the world pattern, de-dollarization will become a global trend in the medium to long term, which will also drive the slow rise of gold denominated in dollars.

In terms of domestic gold prices, domestic gold prices have not followed the rise in international gold prices since November 14 due to exchange rate factors. However, as the exchange rate of the RMB against the US dollar stabilizes, domestic and foreign markets tend to be consistent, the benchmark price of gold in Shanghai also began to rise after experiencing a phased low on November 23. As of November 30, the early trading price was 474.64 yuan/gram.

Regarding the international gold market in the later stages, Huacheng Securities said that the US dollar credit system is weakening, and central bank purchases support the long-term strengthening of gold prices. In recent years, the global trading system and financial system have become increasingly fragmented, and all developing countries are actively reserving gold. Market concerns about anti-globalization trends may cause this round of long-term gold value revaluation. The bank believes that 2024 gold is a type of metal with high allocation value, and is optimistic about the long-term allocation opportunities brought to gold by the anti-globalization process and the interest rate cut cycle.

It should be noted that Wu Weiguang, an analyst at Hehe Futures, said that at present, gold is still following expectations that the Fed will cut interest rates. If the subsequent US economic data weakens further, this expectation will be strengthened, thus further driving up the price of gold. If subsequent US inflation data shows signs of improvement, the upward trend of gold may be interrupted for a short time. Furthermore, if the US economic data continues to improve and the Fed makes hawkish remarks again, the upward trend of gold may also be interrupted. Also, the impact of the December geopolitical conflict cannot be ignored.

Related concept stocks:

Zijin Mining (02899): In the first three quarters of 2023, the company achieved operating income of 225.008 billion yuan, an increase of 10.19% over the previous year; net profit was 16.165 billion yuan, a decrease of 3.01% over the previous year.

Datang Tongjin (08299): For the six months ended September 30, 2023, the company's revenue was approximately HK$84.83 million, up about 7.5% year on year; net profit was HK$15.352 million, down 16.03% year on year.

Lingbao Gold (03330): In the six months ended June 30, 2023, the company achieved revenue of RMB 5.839 billion, up 50.4% year on year; profit attributable to the company's equity shareholders was RMB 140 million, down 21.8% year on year.

Zhaojin Mining (01818): In the first three quarters of 2023, the company's revenue was about 6.385 billion yuan, up 10.29% year on year; net profit attributable to parent company owners' equity was about 365.3 million yuan, up 37.69% year on year.