Gold thirst widens price gap, risks for buyers

The gap between local and global gold prices has widened to some 4 million dong a tael due to the strong demand at home, putting buyers at huge risks and triggering gold smuggling, traders said.
Saigon Jewellery Holding Co., or SJC, last Saturday’s morning sold the precious metal at 45.6 million dong a tael and bought it at 45.2 million dong, while the global price at the time was some $1,657 a troy ounce.

Given the free-market forex rate at some 21,100 dong to the US dollar, the local price was some 3.9 million dong a tael costlier than the global price. A tael is equal to 1.2 troy ounces.

Too strong demand

The sales department of SJC reported the company had sold some 8,000 taels of gold a day, but the demand for gold among the public has seen no sign of abating yet. At Sacombank Jewellery Co., or SBJ, the selling volume was around 5,000 taels per day.

On average, large bullion traders were selling over 17,000 taels, or 637 kilos of gold, a day, or more than 3.8 tonnes of gold in the last one week, excluding the amount sold out by banks.

Enterprises and banks have recently been given quotas to import about four tonnes of gold. After gaining the quotas from the central bank, bullion traders have released their stocks to the market while awaiting the imported amount to arrive to replenish the inventory instead.

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

Posted by VBN on Sep 28 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