The cost of gold bars has remained steady at VND75 million ($3,076) per tael since last Thursday, following an announcement by the central bank to intervene in the market and consider maintaining a monopoly on the gold supply.
Compared to the record high of VND80 million per tael reached on December 26, 2023, the current selling price of SJC gold bullion represents a 6.25% reduction. A tael is equivalent to 37.5 grams or 1.2 ounces. Despite this drop, the current price is still 10% higher than it was over a year ago.
Gold ring prices have also stabilized at VND61.95-63 million per tael. This stability follows the announcement by the State Bank of Vietnam (SBV) that it will intervene in the market and consider maintaining its monopoly on gold supply.
It is important to note that in Vietnam, the production of gold bars is strictly controlled by the government, with SJC, a state-owned company, having the responsibility for this. However, SJC’s gold bar production machinery has been idle for years, and CEO Le Thuy Hang recently stated that the domestic supply of gold bars hasn’t increased since 2014, with some gold bars being diverted to create jewelry for export.
Furthermore, Deputy Governor of the central bank, Dao Minh Tu, assured in a press conference on Jan. 3 that the SBV will ensure the domestic gold bullion price aligns closely with global market rates and will reevaluate SJC’s performance in meeting its obligations.
During the weekend, Vietnam’s gold prices were approximately 20% higher than global rates. Globally, spot gold saw a marginal rise of 0.1% to $2,044.57 early Friday but faces a weekly drop of about 0.9%. U.S. gold futures similarly edged up to $2,051.40, according to financial data platform DailyFX. This downturn is attributed to a rebound in the dollar and yields, with market sentiment shifting away from an imminent Fed rate cut.
Additional Insight:
– The stability in gold prices in Vietnam is notable, as it reflects the impact of government policy on the supply and pricing of gold bars in the country.
– The intervention by the State Bank of Vietnam and the consideration of a monopoly on gold supply signify the importance of the gold market in the country’s economic landscape.
– The continued discrepancy between Vietnam’s gold prices and global rates presents an opportunity for further analysis of the factors influencing gold pricing and supply within the country.
