Gold prices follow rising global trend
Gold prices follow rising global trend
Sai Gon Jewelry Holdings Co. (SJC)'s gold price rocketed up yesterday in line with the global trend.
Its gold was being traded between VND38.8 million (US$1,672) and VND39.8 million (buying and selling) per tael, or 1.2 ounces, at 4pm in HCM City, increasing by around VND1.7 million compared with Tuesday's session.
At the same time, the global gold trading floor listed one ounce of gold at $1,373 (also at $1,654 per tael or 1.2 ounces).
Domestic gold traders attributed the price hike to weak economic data from China and the unstable situation following the Brexit vote.
Analysts said the gold market would likely change a lot this week due to the impact of some important developments — the United States Federal Reserve conference (Fed), the United States' June report on the employment situation to be released and the quarterly financial report by the Bank of England.
Speaking with BizLiVE, Deputy General Director of Phu Nhuan Jewellery Company (PNJ) Nguyen Thi Cuc, said the volume of gold selling and buying at her company in recent days had doubled sales compared with early last month.
Cuc said the gold market showed that local residents still chose gold as a safe shelter from unpredictable fluctuations of the world and domestic markets.
"Many predictions on gold prices from world financial organisations revealed that it would increase, but I think the increase could be due to speculation, making the price higher on the occasion of Brexit, or predictions on the FED's adjustment of interest rates," said Cuc.
The gold price can go up sharply as well as down. In the past, the price of gold lost $100 per ounce in one night," said Cuc.
Insiders said that the unpredictable situation of the gold market could affect the domestic market's stable exchange rate.
Doctor Ngo Huong from the Banking University of HCM City has urged the State Bank of Viet Nam to provide effective measures soon to hold the exchange rate steady in the long term.
Huong said for those economies that were suffering an excess of imports over exports like Viet Nam, it's difficult to maintain a stable exchange rate.
In the short term, the central bank can interfere in the market by selling US dollars at a stable price to meet the payment demand of businesses, said Huong, however, this method would devalue the Vietnamese dong and discourage exports.
As for the long term, he said the Government and Vietnamese businesses needed to have methods to reinforce the economy, producing goods qualified for export.
Other gold companies in Viet Nam, such as Phu Quy, also raised their gold trading prices at VND39 million and VND39.8 million per tael, respectively, some VND2.8 million higher than Tuesday's price.
Bao Tin Minh Chau Company was buying gold at VND38.75 million per tael and selling it at VND39.60 million, increasing by VND2.07 million and VND2.72 million, respectively compared with Tuesday's session.
On the foreign currency market, the central bank increased its reference rate per US dollar by eight dong to touch VND21,866 yesterday.
With a margin of +/- 3 per cent, commercial banks, including Vietcombank and VietinBank, were buying each US dollar at VND22,265 and selling at VND22,335 at noon, lightly decreased compared with early morning of the same day.
Bank for Investment and Development of Viet Nam (BIDV) was trading at a buying and selling price of VND22,270 and VND22,340, respectively, per dollar.
