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Gold prices show sharp increase

Update: August, 24/2012 - 11:10

HCM CITY — Gold prices in the domestic market rose sharply yesterday to VND44.7 million per tael, while global prices were US$1,656 per ounce (VND41.3 million).

On Wednesday morning, prices for the precious metal at several major gold-trading companies in HCM City hovered around VND43.4 million per tael but they increased to VND43.72 million in the afternoon.

The prices had risen by VND720,000 compared with the rates recorded late Tuesday, and by VND1.1 million compared to August 20.

 

Jewelry firm selected to make gold bars

HA NOI — Governor of the State Bank of Viet Nam Nguyen Van Binh signed Decision 1623/QD-NHNN on the organisation and management of gold bar production yesterday afternoon.

Following the new decision, Sai Gon Jewelry Joint Stock Company (SJC), with over 90 per cent of the gold bullion market share and a credible reputation for quality, was appointed to process gold bars for the State Bank of Viet Nam (SBV).

The SBV will use SJC's production line and gold brand, instead of importing a new production line, under its direct supervision on the quota, time and raw materials for production.

Also on the same day, the SBV issued Circular 24/2012/TT-NHNN which modified Article 1 of Circular 11/2011/TT-NHNN issued in April 2011. Accordingly, the Governor of the State Bank will consider the borrowing and lending of gold between credit institutions in special cases to ensure the safety of banks.

The two new regulations took effect from yesterday. — VNS

Yesterday, gold prices continued to escalate to between VND44.5 million and VND44.72 million.

The gap between global and domestic gold prices was about VND3 million per tael.

Nguyen Cong Tuong, deputy head of Sai Gon Jewellery Holding Company (SJC) 's marketing office, said domestic gold prices in the last three days had changed unexpectedly.

On August 21 and 22, domestic gold prices rose to VND43.75 million per tael but dropped to VND43.7 million after many people rushed to sell gold to make profits. But it rose to VND44.7 million on August 23, Tuong said.

According to gold market observers, with the new price changes, the domestic gold prices stand at their highest level over the last four months.

Although gold prices have increased sharply, the gold market has not reached the pricing fever that occurred last year.

In the early afternoon of August 22, the SJC company sold 3,100 gold taels and bought 2,800 taels.

Compared with the number of gold taels sold on August 21, the gold sold on August 22 dropped by one-half, Tuong said.

The owner of a gold shop in Tan Binh District's Pham Van Hai Street said that on August 21 his shop had sold more gold.

Nguyen Thi Cuc, deputy general director of Phu Nhuan Jewellery Joint Stock Company, said that people's demand had increased but this change could not be described as gold fever.

Market experts said that the VND3 million gap between domestic and global gold prices would encourage gold speculators to buy the US dollar to import gold to make profits.

This would affect the current stability of the exchange rate if the Government had no measures to prevent it. — VNS

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