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| SBV offers 40,000 taels of gold in the next gold auction tommorow.— Photo Vneconomy |
HA NOI (Biz Hub)—While all other credit institutions have closed their gold positions, the State Bank of Viet Nam will auction another 40,000 taels tomorrow.
Since March 28, SBV has held 37 auctions, selling 957, 000 taels (equivalent to 36.8 tonnes of gold) to stabilise the market and help local banks close their gold positions.
Deputy governor of State Bank of Viet Nam Le Minh Hung told a local newspaper that all banks had returned their gold deposits by June 30.
Hung said SBV, in its executive role, will conduct more auctions if there is market demand and will be the last buyer if there is gold for sale in the market.
Hung added that in the short term, the SBV's control of the gold market would help prevent gold price fluctuations in the local market, while in the medium to long term, it would narrow the gap between local and world market prices. Currently, the gold price in Viet Nam is still VND 5.5 million (US$262) per tael higher than the global rate.
According to economist Ngo Tri Long, many people have bought gold in recent days due to uncertainty surrounding the macro economy and high local inflation.
Long said SBV should consider taking control of the gold market as more citizens would withdraw their cash to buy gold.
After two days of increases, the gold price fell sharply in the local market this week. The purchase price was below VND36.8 million ($1,752) while the selling price was VND37.25 million ($1,773) per tael.
Meanwhile, the gold price jumped 2 per cent on the world market, the largest increase in more than a month. The price was around $1,241.7 per ounce, up $7 on last week.
According to Kitco News and Bloomberg's surveys, more than half of investors and analysts surveyed forecasted gold prices to recover this week. However, the market would be waiting for economic data from China, the U.S. and Europe. If the information strengthened the US dollar, it would be a disadvantage for the gold market. — VNS
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