Central bank may allow gold imports

Gold trading enterprises may be allowed to import gold if domestic
prices continue to surge, says the head of the State Bank of Vietnam's
Foreign Exchange Department Nguyen Quang Huy.

The statement was made on Oct. 7 after domestic gold prices soared in
the afternoon. One tael of gold (equivalent to 1.2 troy ounces) costs
33.05 million VND (1,690 USD), a record high.

"The central
bank may consider allowing dealers to import a suitable quota to
stabilise market prices in line with global changes," Huy said.

He added that the sudden surge in gold prices was caused by the
increase in global prices, which are now at a record high of 1,349 USD
per ounce. Speculation and psychological worries also likely effected
the inflation.

As of Oct. 7 afternoon, the price of gold
in the domestic market was 1 million VND (51.28 USD) per tael higher
than the global price.

"The imbalance between supply and
demand is making gold prices ‘crazy'," said Huynh Trung Khanh,
International Gold Council's senior consultant official in Vietnam. "The
supply is drying up."

In July, the State Bank allowed
enterprises to import seven tonnes of gold. However, dealers said the
volume was unable to meet the market's growing demand.

In
August, the Vietnam Gold Trading Association asked the central bank to
allow them to import more gold bars to process, but the proposal was
rejected.

The increase in the price of gold caused the US
dollar's exchange rate to increase to 19,850 VND on Oct. 7 from 19,750
VND on Tuesday./.

Related Articles

• SBV licenses gold imports, gold prices slightly down
• Vietnam grants new gold import licenses, quotas
• Easing of safety rules sparks lending rush
• Weightlifter grabs Vietnam’s first Olympic gold at Youth Games
• Tanker spills oil in central Vietnam port

Gold firms get import quotas amid price rally

HCMC – The State Bank of Vietnam on Thursday issued quotas for local enterprises to import gold, sending domestic gold prices down after strong rallies in the previous days.

Nguyen Thi Cuc, deputy general director of Phu Nhuan Jewelry Co. (PNJ), said her company had been allowed to import 300 kg of gold, or around 8,000 taels – a local measurement unit equivalent to 1.2 troy ounces.

PNJ has placed orders with foreign partners and shipments are expected to arrive in Vietnam late this week at the earliest.

Truong Cong Nho, deputy general director of Saigon Jewelry Holding Co. (SJC), said SJC could import 200 kg of gold, or 5,330 taels, and that the yellow metal would arrive early next week.

Domestic gold shot up to VND33.03 million and VND33.1 million per tael for buying and selling respectively at 2:30 p.m. on Thursday but the prices later dropped by nearly VND300,000 shortly after the import quotas were announced.

Local gold on Thursday was VND130,000 per tael higher than the world level, down from the VND860,000 recorded on the previous day.

The central bank also extended import quotas to other large gold firms such as Agribank and Sacombank jewelry companies but the quotas are small.

“The central bank decision will leave a positive psychological impact on the market, helping to ease price hikes, encourage buying and curb selling. Local gold prices might be lower than the world in the future,” Cuc said.

Cuc added buying surged strongly from 3:30 p.m. on Thursday. PNJ as of 5:00 p.m. had sold 5,000 taels and bought 2,800 taels.

Related Articles

• Central bank may allow gold imports
• Assoc insists on power price hike despite protests
• High rice price cuts exports
• Energy group asks for 50% price hike
• Hundreds of companies told to register prices