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Sellers see strong profits on gold prices
The domestic gold price yesterday nudged up by VND80,000 to nearly VND20 million a tael following an uptrend in global gold and the warming prices of other commodities.
Amid the noise of trading yesterday, the price ranged from VND19.83-19.92 million (US$1,114-1,119) per tael – about VND450,000 per tael higher than the world price.
Sai Gon Jewellery Holding Co and Bao Tin Minh Chau Jewellery Co (BTMC) listed the buying and selling price at about VND19.84-19.9 million per tael, up VND60,000 against Wednesday.
Phu Quy Jewellery Co traded SJC branded gold leaf at VND19.85-19.92 million per tael. Sacombank traded gold at about VND19.82-19.92 million per tael, up VND80,000 over the previous session.
PNJ Ha Noi said sellers outnumbered buyers two to one. Gold shops on Tran Nhan Tong Street reported similar trading.
"I think VND19.9 million per tael is what many investors have been waiting for," BTMC business manager Nguyen Huu Dang told Viet Nam News.
Gold exchanges in Ha Noi such as ACB, SBJ and Vina VJC reported noisy trading with orders popularly matched at VND19.50-19.58 million per tael.
Some gold shops in Tan Dinh, Ben Thanh and Ba Chieu areas in HCM City reported noisy trading at about VND19.85-19.90 million per tael.
However, market watchers do not expect domestic gold prices to pass VND20-21 million per tael in the foreseeable future.
"Global gold reached $914 per ounce and it can surge more. However, domestic gold won’t hit VND20-21 million per tael as investors will not accept such high prices," Tran Quoc Quynh, senior member of the Viet Nam Gold Trading Association and a former general director of Vietcombank told Viet Nam News.
Ignoring taxes and fees, domestic gold fetches about VND450,000 per tael more than the world price. [One tael is equivalent to 1.2 troy ounces].
Quynh said as Viet Nam discouraged enterprises importing gold, gold firms did not have many reserves to sell, which would push domestic prices higher.
Late last week, the domestic price of gold fell by VND250,000-270,000 per tael in just two days due to heavy profit-taking selling after gold rallied to VND19.9 million ($1,124) per tael in four consecutive sessions.
Currency
The State Bank of Viet Nam listed the interbank rate at VND16.940 per US dollar, down VND1 against Wednesday.
Vietcombank listed buying, transferring and selling at VND17,787 per dollar – in the upper limit of the daily trading band.
World gold crept higher yesterday on technical buying ahead of the release of results of the US government’s "stress tests" on banks, which will give an indication of the health of financial institutions.
Gold was at $912 an ounce at 5.25 GMT, up 0.3 per cent from New York’s notional close of $909.9. Gold rose despite a fall in the euro versus the dollar. Generally, a higher dollar is negative for gold, but recently gold has been propelled by investor risk aversion, which can be difficult to gauge.
Gold had rallied to a near four-week high of $918.25 last Monday as equity markets fell, due partly to fears that the swine-flu outbreak could hurt the economy, and hopes that China could buy more gold to boost its reserves.
The price of gold in the quarter averaged $908 per ounce, up 14 per cent on the December quarter.
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