Gold prices rising, people rush to sell gold to reap profit

The price of domestic gold has been increasing steadily following price increases in the world market.

The world gold price began increasing the night of June 7 and reached $1250.1 per ounce on the afternoon of June 8, higher than the record price, set in May. The domestic gold price has also been increasing, following the price increase in the world market. SJC brand gold saw its price increase by 540,000 dong per tael June 8, trading at 28.35 million dong per tael with one tael equal to 1.2 troy ounces. Meanwhile, PNJ brand gold price increased more sharply, by 630,000 dong per tael, traded at 28.39million dong per tael on the same day.

Though the domestic gold price increased vigorously on June 8, the price was still lower than the record price of 29 million dong per tael, set in November 2009. This means that with the current price, those who purchased gold in November 2009, still cannot recover capital if they sell gold at this moment.

The gold price increases have prompted people to sell gold to make profit. It seems people have learned lessons from their gold trading. Previously, they rushed to purchase gold when prices rose because they feared prices would go up further, and rushed to sell gold when prices went down because they feared prices would go down further. But now they only sell gold when prices go up in order to make profit.

Nguyen Thi Cuc, Deputy General Director of Phu Nhuan Jewellery Company said that on June 8, her company bought more than 3000 taels of gold, while it sold only several hundred taels that same day. Gold buyers are mostly in the north, where people still have the habit of keeping gold as a liquid asset. Meanwhile, in the south, jewelry companies say sellers are mostly businessmen and those who deposit their gold assets in banks to mature.

At privately-operated gold shops, people also reportedly rushed to sell gold to profit, especially when the gold price increased rapidly in the late afternoon of June 8.

According to analysts, the domestic gold price has been increasing because the price is following the upward trend in the world market, while the domestic price has not been controlled by domestic factors. In the last few days, domestic prices were either lower or equal with the world prices.

The analysts also said there is no clear tendency for gold price performance these days, which means gold’s price can fluctuate unexpectedly.

They said gold prices would keep fluctuating in the coming days. Therefore, the price ebbing and flowing will only benefit surfing investors, while long term investors, or those who buy gold to keep under the pillow as assets, should not purchase gold at this moment because the price is too high already.

Previously, when banks accepted deposits at high interest rates, people, who kept gold as assets, could deposit gold at banks to get profit. However, as the deposit interest rates for gold deposits have dropped from 4-5 percent per annum to 0.5 percent per annum, purchasing gold and keeping gold proves to no longer be such an attractive deal.

Analysts also said that nowadays people must spend more dong to buy a tael of gold than they do to buy a dollar. On June 8, though the gold price increased sharply, the dollar price still decreased in the black market to 18,970-18,990 dong per dollar.

Tuoi tre

Tags: vietnam gold, Vietnam gold market, Vietnam gold prices