Gold Prices in Vietnam Surge to New Record Highs
The price of gold in Vietnam continued to climb on Monday to reach a new record high. The SJC gold bar price rose by 1.30% from Sunday to VND78 million ($3,217.16) per tael at around 3 p.m. after reaching a historic peak of VND77.3 million just a few hours earlier. This means that gold prices added VND1 million per tael in a single day. Additionally, the price of gold rings marginally gained by 0.16% to VND63.05 million per tael. Vietnam gold prices have been surging in recent weeks due to low supply, attributed to the decline in supply since 2019 when a large quantity was exported.
Le Thuy Hang, the CEO of Saigon Jewelry Company, which exclusively produces Vietnam’s SJC gold, stated that the supply of gold has been declining due to the low domestic supply. As a result, Vietnam’s gold price is currently much higher than the global rate. It is worth noting that the U.S. market was closed on Monday for the Christmas holiday. As per Reuters, gold scaled a more than two-week high on Friday, rising for a second week as the dollar and U.S. Treasury yields slipped on rising expectations that the Federal Reserve will cut interest rates early next year. Spot gold was up 0.4% at $2,052.69 per ounce, its highest level since Dec. 4, putting it on course for a 1.7% weekly gain.
The surge in gold prices is not unique to Vietnam, but a global phenomenon. The global gold bar price is now 29% lower than the gold bar price in Vietnam, signaling a trend of increasing disparity between local and global rates.
Insight: The surge in gold prices in Vietnam is indicative of the wider economic impacts of the COVID-19 pandemic and geopolitical uncertainty. As investors seek safe-haven assets, such as gold, during uncertain times, the demand for the precious metal is driving up prices both locally and globally. Furthermore, the declining supply of gold due to exports and the closure of certain mines during the pandemic is exacerbating the situation, causing prices to reach record highs. This trend is expected to continue until economic stability is restored and confidence in traditional financial markets returns.
