HCMC – Local gold on Wednesday shot up to a record high of over VND31 million per tael as the yellow metal rose to US$1,310 an ounce in the New York market a day earlier.
Gold made by SJC, the country’s leading gold trading house, closed up at VND31.16 million for buying and VND31.23 million for selling late on Wednesday afternoon, up VND650,000 from the previous day. The selling price briefly touched an all-time high of VND31.35 million a tael – a measurement unit which is equivalent to 37.5 grams.
Gold trade, however, was almost flat. Nguyen Thi Cuc, deputy general director of Phu Nhuan Jewelry Company (PNJ), said gold demand grew strong in the morning but declined in the afternoon.
PNJ sold 750 taels on Wednesday and bought around 400 taels, Cuc said, adding it seemed that individuals did not rush to sell the metal to take profits as 40% of the bought volume came from corporate clients.
The local gold rally is faster than elsewhere in the world, leading to a differential of VND400,000 per tael with tax and fee excluded or VND150,000 after all tax and fee deductions, she said.
Selling by individual gold owners has remained limited while traders are still banned from importing gold, causing a shrinkage of supply on the market, she said, explaining the rally. Moreover, given the continued volatility on global gold markets, local traders tend to hike prices to mitigate price risk.
Due to reduced supply, SJC traded a combined 1,500 taels on Wednesday, down from 4,500 taels a day earlier, said Nguyen Cong Tuong, deputy sales manager of SJC.
He noted a majority of sellers wanted to offset earlier losses and that there were no signs of people rushing to sell to rack up profits so the volume of gold bought from individuals accounted for around one-tenth of that from companies on Wednesday.
Meanwhile, the gold price quotation board at Sacombank Jewelry Company (SBJ) flashed continuously. This firm’s buying price was VND31.18 million and its selling price VND31.28 million.
An SBJ sales executive said the difference between selling and buying prices was big due to their strong volatility.
