Vietnam gold price soars to new high of $3,346 per tael

By Lan Do
Tue, April 9, 2024 | 5:34 pm GMT+7

Domestic SJC gold bar prices reached a record VND83.5 million ($3,346) per tael Tuesday, an increase of VND1.6 million ($64.1) in just two days.

State-owned Saigon Jewelry Company raised the selling price of SJC gold bars Tuesday morning to VNV83,000,000 ($3.325) per tael, the highest ever, up VND600,000 ($24) per tael over Monday.

By Tuesday afternoon, the selling price of SJC gold bars rose by another VND500,000 ($20) per tael to VND83.5 million ($3,346). The buying price also rose to VND81.5 million ($3,265) per tael.

Domestic SJC gold bar price hits a record high of VND83.5 million ($3,346) per tael on April 9, 2024. Photo courtesy of the gosvernment's news portal.

Domestic SJC gold bar price hits a record high of VND83.5 million ($3,346) per tael on April 9, 2024. Photo courtesy of the gosvernment's news portal.

Thus, the selling price of SJC gold bars has increased by VND1.6 million ($64.1) per tael in just two days.

Dao Le Trang Anh, lecturer in finance at RMIT Vietnam, said that recent increases in domestic gold prices in Vietnam can be linked to several factors, including global economic trends and domestic economic conditions.

Heightened global economic uncertainty contributed to recent record highs in the world gold prices. Significant events such as the recent mass shooting in Russia, elections worldwide in 2024, and ongoing conflicts including Ukraine and Gaza have strongly impacted investor confidence.

This has sparked a noticeable increase in demand for gold as a safe-haven asset. The surge in gold prices is also partly driven by strong demand from private investors in China due to sluggish performance of the real estate sector. The U.S. Federal Reserve's (Fed) plan to cut interest rates three times in 2024 is an additional factor that has pushed gold prices up in Vietnam's domestic market.

In a related move, the government has asked the central bank to figure out ways to stabilize the gold market and narrow the spread between local and international gold prices. In addition, the central bank needs to propose a new version of Decree 24, dated 2012, on gold trade management, which is believed to be outdated.

Globally, gold prices went past $2,345 an ounce Tuesday, hovering at its highest levels on record, propelled by strong central bank purchases. The People's Bank of China continued its streak of increasing gold reserves for the 17th consecutive month, bringing its total reserves to 72.75 million ounces in March.

Turkey, India, Kazakhstan, and some Eastern European countries have also ramped up their gold purchases this year. Investors now await the Fed's policy meeting minutes and key inflation data due later this week, which could give cues on the timing and depth of the widely expected rate cuts. Markets have reduced their bets on the extent to which the Fed will lower rates this year, with about 50% on the first rate cut in June following a robust labor data report last week.

 World gold price was $2,345 per tael,  April 9, 2024. Source: Trading Economic.

World gold price was $2,345 per tael, April 9, 2024. Source: Trading Economic.

In an interview with Kitco News, Robert Minter, director of Investment Strategy at Abrdn (UK-based investment group), said that gold’s rally to record highs above $2,345 an ounce is just getting started, and it's only a matter of time before retail investors jump into gold-backed exchange-traded funds to kick off the next major hike.

Minter explained that since April 2022, Exchange Traded Fund (ETF) investors have sold around 750 tons of gold, creating a massive supply in the marketplace that was met with two years of historic demand from central banks.

He pointed out that central bank demand hasn’t gone away, but the supply of gold has dried up as ETF selling has slowed to a trickle. Although central bank gold buying has slowed in recent weeks, Minter said the overall trend in official purchases remained high.

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