Aug 11: Vietnam gold prices extreme volatile, dollar falls under vnd21,000 at gold shops

Vietnam gold prices had an extreme volatile trading day today as it swung to top VND46 million/tael in early trade before easing down to VND45 million 1 hour later but then it bounced back following suit global gold prices

Vietnam gold prices had an extreme volatile trading day today as it swung to top VND46 million/tael in early trade before easing down to VND45 million 1 hour later but then it bounced back following suit global gold prices. Dollar prices were stable at banks but fell in the grey market on caution.

As of 11:00 Hanoi time, Sacombank-SBJ gold was listed at VND45.11 million/tael and VND45.59 million/tael for bid and ask, respectively.

SJC in Hanoi was listed at VND45.1 million/tael and VND45.62 million/tael for bid and ask, respectively while SJC in the free market was quoted at VND45.1 million-VND44.60 million a tael for bid and ask respectively.

Gold prices were extreme volatile in the past few days and went crazy this morning in a tug-of-war between profit takers and seek-for-safe-haven buyers.

Global cash gold hit an all-time high of $1,813.79 while US gold future rose to a record high of $1,817.6 early in the day. But both eased after the CME Group said it raised margins on U.S. gold futures by 22.2%
The latest gold frenzy sent local gold prices from a discount to a premium to global prices. As of 11:00 Hanoi time, local gold price was VND45.6 million ($2,189) a tael (37.5 grams or 1.21 troy ounces) or equivalent to $1,817.5 an ounce, higher than spot gold $1793 last bid at the same time in Asia market.

State-run television VTV reported today that only 1 out of 5 tons of gold allowed to imported by the SBV will arrive in Vietnam this week as companies scaled down their gold imports on high volatility and narrow spread between local and global markets.

Global markets : Gold Falls Below $1,800 After CME Margin Hike

Gold fell below $1,800 in Asia market after CME Group said it raised margins on U.S. gold futures by 22.2% to $5,500 per contract from $4,500 a contract for speculators, effective from the close of business on Thursday.

Spot gold was last bid at $1,787 an ounce by 0:32 New York time, having hit a record at $1,813.79 on Wednesday.

The sharp rally in gold futures, which have risen more than 9.5 percent in the past four sessions, had prompted market talk of a margin rise. The CME, the world’s largest commodity exchange had quick response to that.

“Historically when margins are raised significantly it tends to cause a bit of sell-off,” Reuters and CNBC quoted Darren Heathcote, head of trading at Investec Australia as saying.

“We’ve seen some of it now, but it’s difficult to see a great deal of selling, because we are in very, very volatile and uncertain times when markets are moving very violently. Gold has proven too much an attraction as an alternative investment and the margins may not have as much influence.”

SPDR Gold Trust Buys 10.6 Tons of Gold

Holdings of the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust , was 1,296.52 metric tons on Wednesday, hardly changed from 1,296.90 metric tons on Tuesday.

SPDR’s holdings’ record-high was 1,320.436 tons on June 29 last year.

Dollar prices

Vietnam’s central bank set the U.S. dollar’s exchange rate at VND20,618 on Thursday, unchanged from Wednesday.

Commercial banks this morning sell dollar mostly at the ceiling rate, VND20,824.

However, dollar turned tail on the grey market today to under VND21,000 as gold import licensed companies trimmed down or their gold imports or even stayed on the sidelines due to extreme volatility of global gold prices and narrow spread between global and local gold prices – Stoxplus.com

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Posted by VBN on Aug 11 2011. Filed under Gold. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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