Gold remains unchanged during weekend

For the first time this year gold prices in Vietnam remained almost unchanged for two straight days last weekend after more than eight tons of the metal were sold at less than market rates under a central bank stabilization package.

They were around VND43.45 million a tael (37.5 grams), while globally it closed last week at $1,638.4 an ounce.

With the dollar traded on the black market at VND21,500, the gap between domestic and global prices was around VND980,000 a tael.

In late September it was a record VND4 million.

Nguyen Cong Tuong, deputy sales manager of Saigon Jewelry Co, the country’s largest gold trader, said the State Bank of Vietnam’s measure had achieved its target of narrowing the gap.

The price stabilization measure, initiated on October 6, has an alliance of SJC and five banks selling gold at lower than market prices.

Tuong said the gap would continue to narrow to around VND500,000.

“At that rate, gold traders will still enjoy a profit of VND100,000 a tael,” he said.

By Saturday the alliance members — DongA Bank, Asia Commercial Bank, Techcombank, Eximbank, and Sacombank being the others — have sold around eight tons of gold to the market.

They had sold five tons on the first day before sales began to drop.

On October 6 SJC sold 20,000 taels before the numbers dropped to 12,000 and 3,000 taels in the next two days.

Gold traders said investors had temporarily stopped purchasing to watch market developments after the prices dropped.

The owner of a jewelry shop in Hanoi said investors had stopped buying partly because of anticipation of a further slump.

“Besides, since many of them bought when prices stood at VND45 million a tael, they have to wait for prices to go up again to sell and buy more,” he explained.

Meanwhile, the interbank exchange rate remained at VND20,653 for a third consecutive day, while banks traded the greenback at the ceiling of VND20,860.

On the black market, the greenback’s selling price continued to fall.

In Hanoi it traded today at VND21,350, down VND50 since the weekend.

The dollar has weakened by VND350 since last week.  -Tuoitre

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