GCAP Identifies Early Stagflation Signals in Global Economy, Supports Gold Rally; Recommends Accumulating at 68,500–68,200 Baht

GCAP GOLD assesses that the global economy is beginning to show stagflation signals following simultaneous declines in stocks and bonds, while inflation remains elevated and geopolitical risks pressure markets. Gold is expected to fluctuate in the short term but maintain an uptrend in the medium to long term, with the firm recommending gradual accumulation if prices weaken near 68,500 baht per baht of gold.

On May 7, 2569, Areerat Murachai, head analyst at GCAP GOLD, revealed that current market conditions are showing concerning signals, particularly as major assets like stocks and bonds decline simultaneously—historically marking the beginning of an economic slowdown cycle while inflation remains stubbornly high. This is causing the global economic structure to undergo significant transformation and reflect early stagflation signals, which marks the starting point of a cycle favorable for gold's return in the coming period.

Another critical market factor is energy pressure, particularly geopolitical risks in the Middle East and the Strait of Hormuz, which directly impacts global oil prices and inflation. As inflation pressures persist, major central banks, especially the U.S. Federal Reserve, are likely to maintain high interest rates longer, keeping the dollar strong and bond yields elevated—factors that pressure gold prices in the near term.

However, within the stagflation cycle structure, gold typically doesn't appreciate immediately in the early phase due to pressure from rising real yields. But when the economy shows clear slowdown signals and inflation fails to decline as targeted, these factors become a crucial turning point that will restore gold's prominence as a systemic risk hedge, particularly when monetary policy has limited capacity to stimulate the economy.

"In the short term, gold prices will remain volatile, moving more in a sell-and-buy pattern than a continuous uptrend, with the dollar and bond yields limiting upside. But in the medium to long term, stagflation structure will be a key driver for gold to return to an uptrend, especially if economic slowdown occurs alongside embedded inflation, which will accelerate significant capital inflows into safe-haven assets," the analysis states.

The analysis recommends investors wanting to accumulate gold for medium to long-term portfolios wait for prices to weaken near 4,400 USD, equivalent to approximately 68,500–68,200 baht in Thai gold prices, then gradually enter positions. This zone serves as a key support level that has historically supported gold's rallies in late 2568 and is important for the long-term structure, making it suitable for beginning accumulation for investment.

For short-term portfolios, investors are advised to trade along price swing cycles using a primarily "sell-and-buy" strategy—entering purchases when prices dip near key support levels and gradually selling for profits when prices bounce, with clear stop-loss points to manage short-term volatility risk.