BANGKOK: The Thai Gold Traders Association held urgent talks on Monday after violent price swings, platform outages and delays in price-setting amid a sharp selloff.
Gold prices in Thailand were extremely volatile on Monday, falling sharply and repeatedly throughout the day in line with global spot gold, which saw an unusually heavy sell-off.
The Thai Gold Traders Association reported 69 intraday price adjustments, with prices down as much as 3,050 baht.
The latest quoted selling prices were 71,150 baht for bullion and 71,950 baht for jewellery gold, while spot gold stood at US$4,775 per ounce.
The sharp decline and rapid swings caused widespread disruption across the domestic gold market, affecting both investors and gold shop operators.
As spot and local prices moved rapidly every two to three minutes, online gold trading systems were unable to cope with transaction volumes, causing applications to crash and preventing some investors from executing orders in time as prices slid.
The association also faced difficulties publishing benchmark prices.
Jitti Tangsitpakdee, president of the Thai Gold Traders Association, said that at certain points price announcements were delayed by almost 10 minutes because global prices were changing so quickly that it was difficult to determine a stable reference price in time – a situation he said had not happened before.
The association said it had repeatedly warned over the past two weeks that short-term investors should exercise extreme caution, citing overly aggressive speculation and the risk of sudden price corrections.
It warned of the possibility of margin calls if the market swung the wrong way.
It also noted heavy speculative activity in the futures market, saying large funds are key players influencing price direction and that trading volumes in futures markets can exceed the amount of physical gold available globally.
The impact was not limited to investors. Gold shop operators were also exposed to potential heavy losses, as the spread between the association’s announced “buy/sell” prices and actual market prices widened sharply during extreme volatility.
Jitti said the association held an emergency meeting on Monday with all relevant parties, including wholesale and retail representatives, to agree a joint response. — The Nation/ANN
