Spot gold prices fell sharply on June 10 morning Beijing time, dropping below $4,200 during trading and reaching $4,174.57 per ounce at publication, marking a 3.33% decline year-to-date and approximately $1,400 per ounce below the yearly high. Domestic Chinese gold jewelry brands responded with collective price cuts on June 10, with all major retailers falling below 1,300 yuan per gram—Chow Sang Sang dropped 45 yuan to 1,277 yuan/g, Lao Miao Gold fell 34 yuan to 1,283 yuan/g, and Lao Feng Xiang decreased 40 yuan to 1,276 yuan/g from prior-day levels. The declines follow escalating US-Iran military tensions and market concerns over upcoming US inflation data and global central bank monetary tightening, with analysts citing strong dollar and Treasury yields pressuring non-yielding assets.
Domestic Jewelry Brands Record Sharp Single-Day Price Drops
On June 10, major Chinese jewelry retailers implemented significant price reductions. Chow Sang Sang pure gold jewelry fell to 1,277 yuan per gram from 1,322 yuan the previous day, a 45-yuan decrease. Lao Miao Gold pure gold jewelry dropped to 1,283 yuan per gram from 1,317 yuan, down 34 yuan. Lao Feng Xiang pure gold jewelry declined to 1,276 yuan per gram from 1,316 yuan, a 40-yuan reduction.
On January 29, domestic jewelry prices reached historical peaks, with Chow Sang Sang at 1,708 yuan per gram, Lao Miao Gold at 1,706 yuan per gram, and Lao Feng Xiang at 1,713 yuan per gram. Compared to these yearly highs, the three brands have declined 431 yuan, 423 yuan, and 437 yuan respectively, representing approximately 25% decreases.
US Conducts Strikes on Iran Following Helicopter Incident
According to Xinhua News Agency, Axios reported on June 9 that the United States is conducting a "third round" of strikes on Iran. US President Trump stated on social media on June 9 that Iran shot down a US Apache helicopter in the Strait of Hormuz, with both pilots unharmed, but the US must respond to the attack.
Iranian media reported on June 10 that multiple explosions were heard near Bandar Abbas and the Sirri area in the early morning hours of that day. An explosion also occurred on Qeshm Island in the early morning of June 10.
Analysts Cite Inflation Data and Central Bank Policy as Price Pressures
Guosen Futures stated that the upcoming release of US May CPI data has raised market concerns that above-expected inflation will strengthen Federal Reserve expectations to maintain high interest rates or even raise rates. The dollar and US Treasury yields are operating at high levels, creating pressure on non-yielding assets. The Bank of Japan plans to raise interest rates to 1%, and the hawkish trend among major global central banks continues, further weakening precious metals' appeal. Regarding geopolitical factors, US-Iran military friction has escalated, but the market is sensitive to the negative transmission logic of "conflict → inflation → rate hikes," and risk-aversion sentiment has not significantly boosted gold prices. Guosen Futures suggested that gold prices may continue weak fluctuations before CPI data is released in the short term, recommending a wait-and-see approach pending inflation data guidance.
According to CNBC reporting on June 9, Citi analysts stated in a research report released on June 8 that if the Strait of Hormuz closes until the end of summer, gold prices could fall to $3,500 per ounce. While gold has traditionally been viewed as the ultimate safe-haven asset during periods of market turbulence, its short-term risk is extremely high.
"In the long term, we remain bullish on gold trends; however, for investors who have not set large stop-loss ranges and are not positioned for the long term, the current stage of entry carries extremely high risk," Citi analysts stated.
FAQ
What caused spot gold to fall below $4,200 on June 10?
Spot gold fell below $4,200 during trading on June 10 morning Beijing time due to multiple factors including escalating US-Iran military tensions, market concerns over upcoming US May CPI data potentially showing above-expected inflation, strong dollar and Treasury yields pressuring non-yielding assets, and the Bank of Japan's plans to raise interest rates to 1%.
How much have Chinese gold jewelry prices declined from their yearly highs?
Chinese gold jewelry prices reached peaks on January 29, with Chow Sang Sang at 1,708 yuan per gram, Lao Miao Gold at 1,706 yuan per gram, and Lao Feng Xiang at 1,713 yuan per gram. As of June 10, these brands have declined to 1,277 yuan/g, 1,283 yuan/g, and 1,276 yuan/g respectively, representing decreases of 431 yuan, 423 yuan, and 437 yuan—approximately 25% declines from the yearly peaks.
What did Citi analysts state about gold price risks?
In a research report released on June 8, Citi analysts stated that if the Strait of Hormuz closes until the end of summer, gold prices could fall to $3,500 per ounce. The analysts noted that while they remain bullish on gold in the long term, current entry carries extremely high risk for investors who have not set large stop-loss ranges and are not positioned for the long term.
