Gold's rise came to an abrupt end as the strong dollar and US bond yields soared.

On Thursday, spot gold fell below 2,560 US dollars/ounce to a low of nearly two months.

As of press release, it is now down 0.58% to $2557.63 per ounce; COMEX gold is down 0.94% to $2562.2 per ounce.

Spot silver also fell below the $30 per ounce mark, a low in nearly two months. COMEX silver fell 2.11% to $30.015 per ounce.

Since Trump won the US election, the price of gold, which had taken off all the way before, began to cool down like a cliff.

Since last week, the price of gold has fallen by nearly 7%; of the past 7 trading days, it has declined in 6 trading days.

Meanwhile, along with the correction in gold prices, Hong Kong A gold stocks have also been dragged down.

Today, the Hong Kong and A gold sectors continued to decline. Hong Kong stocks such as Lingbao Gold fell by more than 5%, while Zhaojin Mining and Zijin Mining all fell by more than 3%; A-shares such as Hunan Gold and Sichuan Gold fell by more than 2%.

Press the pause button for the gold bull market

What is behind the fall in gold is the comeback of a strong dollar caused by Trump's “second entry into the house.”

The previous week, Trump trading dominated the market, and the US dollar index had already risen to a seven-month high; at the same time, US 10-year bond yields continued to rise.

The appreciation of the US dollar reflects the market's pricing of Trump's general inflation policy agenda, which in turn suppresses safe-haven purchases of gold. This also caused capital to shift from gold to inflows into US stocks, Bitcoin, etc.

On the other hand, US inflation expectations and room for the Federal Reserve to cut interest rates.

According to the latest US inflation data, the CPI rose 2.6% per year in October, up from 2.4% in September; the annual increase in core CPI stabilized at 3.3%, which is expected to be 3.3%.

MarketPulse by OANDA market analyst Zain Vawda said that the increase in CPI was in line with expectations, and the impact on gold prices was mixed.

According to the CME Federal Reserve Watch Tool, traders expect the possibility that the Fed will cut interest rates in December to be 83%, up from about 63% before the data was released.

Although the market increased its bet on cutting interest rates by 25 basis points in December, the pace of interest rate cuts is expected to slow in 2025.

Michael Pugliese, senior economist at Wells Fargo Bank, said that progress in US inflation has begun to stall.

“The time for the Federal Reserve to signal that the pace of interest rate cuts will slow further is fast approaching. Perhaps starting in 2025, the pace of interest rate cuts will slow down to once every other meeting.”

It is also important to note that if inflation soars under the pressure of Trump's new tariff policy, it may cause the Federal Reserve to suspend the easing cycle.

Currently, uncertainty about the prospects for interest rate cuts is intensifying, and the Federal Reserve remains alert at all times.

IG market strategists expect that the Federal Reserve will be more cautious in the future easing process. This indicates that stronger yields and the US dollar are facing upward pressure, which may put pressure on the price of gold.

What do you think of Wall Street?

So, is the gold bull market over?

Wall Street generally expects that gold will continue to fluctuate in the short term and remain optimistic in the medium to long term.

Maximilian Leighton, Citigroup's global head of commodity research, said that the gold and silver bull markets have been suspended, and this situation is likely to continue for the next few weeks or so.

He pointed out that as the US stock market rises due to the prospects of tax cuts and deregulation, the price of gold may fall. Trump's return to the White House has brought the US stock market to a record high, although gains have slowed somewhat.

UBS believes that although the end of the US election has indeed eliminated some uncertainties and risks, the current decline in gold prices seems to be excessive.

US Treasury yields and the US dollar are likely to resume a downward trend within the next 6-9 months, which will support the price of gold.

Investors can consider buying when the price of gold pulls back to about 2,600 US dollars/ounce and maintain the target price for 12 months at 2,900 US dollars/ounce.

This means that the price of gold still has room to rise 11% compared to the present.

Analysts from the World Gold Council also pointed out that the results of the US election have had a slight impact on the strong rise in gold prices so far this year. However, the price of gold is currently only facing a welcome pause, or even a healthy short-term correction.

Financial services firm Canaccord Genuity said the central bank's demand for gold is expected to remain strong or even grow due to the heightened US fiscal outlook and geopolitical tension.

According to the data, net gold purchases by central banks increased to 483 tons in the first half of this year, which is 5% higher than the previous record set in the same period last year.

Canaccord Genuity said that factors such as increased debt, geopolitical tension and central bank demand are expected to support the rise in gold prices.

“If Trump's second term is similar to his first term, we believe strong international demand for gold as a reserve asset is likely to continue relative to the demand for treasury bonds.”