On January 13, gold stocks plunged significantly, with most major gold stocks falling. At the time of reporting, Zijin Mining (02899) dropped 5.85% to HKD 14.48; Shandong Gold (01787) decreased by 3.51% to HKD 13.74; China Gold International (02099) declined 2.14% to HKD 43.45; Lingbao Gold (03330) fell 2.04% to HKD 3.85. The market appears more cautious about the outlook for gold prices.
The Strong Dollar Puts Pressure on the Gold Market
According to reports, driven by the first non-farm payroll data of 2025, the U.S. dollar index once broke the key level of 110, reaching its highest point in over two years. Goldman Sachs recently stated that due to the persistent strength of the U.S. economy and new tariff policies implemented by Trump, the dollar might strengthen by about 5% over the coming year, with a risk of further appreciation. This marks Goldman's second upward adjustment of the dollar forecast in two months.
The market's confidence in further rate cuts by the Federal Reserve has gradually weakened. Analysts noted that the resilience of U.S. economic growth and the potential tariff policies from the Trump administration may increase inflationary pressures, diminishing the appeal of gold as an inflation hedge.
Gold Price Trends Constrained by Multiple Factors
Industry experts believe that changes in U.S. inflation expectations are currently one of the main factors affecting gold prices. If inflation expectations continue to rise or remain high, gold prices may find support. However, the current market anticipates that the Trump administration's "America First" policy could further boost the dollar and suppress inflation, making it difficult for a rebound in inflation expectations to be sustained.
Moreover, with the strengthening dollar and growing optimism about the U.S. economy, the allure of gold as a safe-haven asset has weakened. Under the pressure of the rising dollar, gold prices might continue to face downward pressure in the short term.
In the future, investors must closely monitor changes in Federal Reserve monetary policy and U.S. inflation levels to gauge the direction of the gold market.
