Vietnam gold price may hit VND33Mln at year-end

“Local gold prices have continuously increased in the past years and may hit VND32.5million/tael – VND33million/tael at the end of this year. Gold prices have gained 6 times higher during the last 10 years”.

“Local gold prices have continuously increased in the past years and may hit VND32.5million/tael – VND33million/tael at the end of this year. Gold prices have gained 6 times higher during the last 10 years”, said Huynh Trung Khanh, Vice Chairman of Vietnam Gold Traders’ Association and Senior Advisor of World Gold Council.

Local gold prices have been following the rising momentum of global prices, Khanh said, adding that domestic gold prices are VND400,000/tael higher than that global ones.

Global gold prices are flying mainly on concerns over the slow pace of global economic recovery, accelerating inflation and weaker dollar against a basket of currencies, Khanh pointed out, adding that people have switched to gold as a safe haven.

Festive seasons in India and China, the world’s second-largest gold consumers also spur gold demand and help to drive gold prices up, Khanh added.

Continued uncertainty over the state of the economy will prompt gold to rise as high as $1,350 an ounce by the end of 2010 and $1,500 in 2011, thereby pushing up the local gold prices to VND32.5million-VND33million by the end of this year, Khanh said.

Khanh rejected investors’ biases that local gold prices are likely being manipulated by affirming that Vietnam gold market are too big for speculation to dominate. The strong rally in September gold was driven by mounting local demand, mainly stemming from the massive stop loss as short-sale investors were forced to cover back.

The gap between local and global gold prices will be narrowed soon on illegal gold imports by some local enterprises, Khanh said, reasoning that this move will push up gold supply.

Earlier, Nguyen Van Giau , the Governor of the State Bank of Vietnam (SBV), confirmed that “ there is no gold scarcity in Vietnam and gold import is not yet urgent”.

However, Khanh suggested that the SBV had better approve gold import to ease investors’ sentiment, not to balance supply-demand, adding that importing about 5 tons of gold is reasonable as Vietnam already export 60-70 tons of gold this year. – Stoxplus.com

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