Vietnam central bank eases conditions, sells 48% gold offered at sixth auction

Easier conditions helped Vietnam’s central bank sell 8,100 taels of gold Tuesday, 48.2% of the volume offered in the sixth auction since it resumed auctions last month after 11 years.

This is the largest sales volume in three auctions wherein gold bullion changed hands, with the other three drawing a blank.

In all the six auctions held by the State Bank of Vietnam, a total of 14,900 taels, or 14.8% of the volume put up, have been sold to date.

At today’s auction, eight companies bought the yellow metal at VND87.72-87.73 million ($3,446.7) a tael, VND1.3 million a tael lower than the selling price at state-owned Saigon Jewelry and Germ Stone Co. (SJC).

SJC offered its SJC-branded gold biscuits at VND86-89 million ($3,496.6) a tael at Tuesday’s open for bids and asks, down VND1.5-1 million from Monday’s close, respectively.

The selling price at Doji stood at VND87.5 million ($3,437.6) a tael.

Gold offered by the central bank became more attractive after the bank lowered its starting price to VNDD87.7 million ($3,445.5) a tael from VND88 million announced Monday.

In addition, the bank reduced the minimum bidding volume to five lots of 100 taels each, down from seven lots in the previous auctions. The maximum volume was also raised to 20 lots, doubling the previous limit.

Recent swings in prices have made headlines in Vietnam, where gold is highly popular as a safe haven asset.

Gold prices hit an all-time high of VND92.4 million ($3,630) a tael last Friday, about VND20 million higher than global prices.

Senior parliamentarians expressed concerns over the volatility of gold prices at a Monday meeting where they asked government officials to intervene and ease the gold fever.

Pham Thanh Ha, Deputy Governor of the State Bank of Vietnam, blamed the price really on a 14% increase in global prices in the year to date and undersupply in the country. He promised to increase supply and crack down on violations in the gold market.

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