Vietnam gold prices hit all-time high amid Covid-19 resurgence

Vietnam’s gold prices have continued the growing trend to reach an all-time high today [July 28], tracking the global rally of the metal, amid the resurgence of Covid-19 pandemic in some localities.

DOJI, Vietnam’s largest jewelry company, sold SJC gold, the national brand, at VND57.85 million (US$2,504) per tael early Tuesday, up VND900,000 (US$38.92) against its buying price and VND1.15 million (US$49.73) compared to the selling price on Monday. A tael is 37.5 grams or 1.2 ounces.

Meanwhile, state-owned Saigon Jewelry Company (SJC) bought gold at VND56.50 million (US$2,442) per tael and sold it at VND58.12 million (US$2,512), up VND1.05 million (US$45.39) and VND1.2 million (US$51.88) against the previous trading session, respectively.

Global uncertainties also pushed the gold prices on the international market to a record high of US$1,974 per ounce early today, up over 27% compared to early 2020 and higher than its previous record of US$1,920 per ounce in 2011. The prices, however, are nearly VND3 million (US$130) lower than SJC’s selling prices.  

Financial and banking expert Nguyen Tri Hieu.

Financial and banking expert Nguyen Tri Hieu told Hanoitimes the increasing gold prices on the international market has directly contributed to its all-time high domestic prices, not to mention the recent emergence of local coronavirus infections in Danang and Quang Ngai in central Vietnam.

With the current complicated Covid-19 progression in the US, Hieu expected within one month, gold prices on the domestic and international markets could soon reach the VND60 million (US$2,591)- and US$2,000- marks, respectively.

“In the short term, high gold prices, mainly due to negative investor sentiment, do not have significant impacts on the local economy, as the gold supply–demand remains balanced,” Hieu said.

“However, if this trend continues for a longer period, prices of other goods would be affected, leading to a weaker Vietnamese dong (VND) and high inflation rate,” Hieu warned.

According to Hieu, with a strong volatility of gold prices, gold trading companies are selling at high prices but buying at low prices, in turn putting gold investors at risk.

Hieu suggested investors be cautious when the spread of gold prices in the domestic and international markets is around VND3 million (US$130), and that of the domestic selling and buying prices is VND1 million (US$43.17) or more.

Sharing the same view, Vice Director of the State Bank of Vietnam – Ho Chi Minh City Branch Nguyen Hoang Minh urged investors to stay calm as gold prices may continue to fluctuate in the future, given the ongoing spreading of Covid-19 pandemic globally and escalating tensions in the US – China relations.