Metal Focus' Chirag said the fundamentals of gold have not drastically changed and those that did not get the chance to participate then, will now want to do so.
KUALA LUMPUR: Despite the price of gold continuously falling this week, the correction in prices has come at the right time, says India-based Metal Focus principal consultant, Chirag Sheth.
He said the drop was expected, particularly since prices had peaked and there was a sharper run up in the commodity in recent weeks.
Spot gold fell as much as 10% on Monday while silver also slumped around 16%.
The drop was a result of financial markets reacting to President Donald Trump’s nomination of Kevin Warsh as chair of the United States Federal Reserve (Fed).
“When the market has run up so much, one piece of news led to panic-selling and that’s what has happened with gold prices. But timing wise, it is good, because now it allows new entrants to come into the gold market,” he told StarBiz on the sidelines of the 3rd edition of the Malaysia Gold Conference 2026 here yesterday.
Chirag explained that despite investors being cautious, the fundamentals of gold have not drastically changed and those that did not get the chance to participate then, will now want to do so.
“The dust will settle, and people will look at the substantive factors that drive the demand for gold,” he opined.
As for the forecasts, Chirag said he expects prices to vary between US$5,500 and US$6,000 per ounce.
“We remain bullish but what we are saying as well is, be prepared for a volatile market. We could possibly see a 10% or 15% move in a quarter, but given the environment, such a move could be normal,” he said.
Meanwhile, Malaysia Gold Association president, Datuk Seri Louis Ng said the instability in Iran as well as talks of peace between Ukraine and Russia have also impacted the price of gold.
“These are all parts of the reason why the market has reacted so drastically. So volatility is likely, but we expect the market to stabilise,” he said
Ng reckoned that because gold is very sensitive to interest rates, the industry will be waiting to see if the Fed cuts rates.
“A rate cut will be good for the gold market – it is a high priced item so the costs of holding it is expensive. If there are no cuts, we think prices should remain between US$5,000 and US$5,500,” he said.
On a separate note, the Malaysia Gold Industry Principles (MGIP) was launched at the event with the aim of enhancing and strengthening the standards of the industry in the country.
Ng said it will serve as a self-regulatory foundation while ensuring there is responsible sourcing and ethical conduct, coupled with transparency and anti-fraud safeguards among others.
