Gold extends drop after disappointing Fed meeting

Price of gold in Vietnam dropped near VND42 million a tael (1.2 ounces) on June 21 as global price struggled to hold US$1,600 an ounce mark after the US Federal Reserve policy meeting.

Saigon Jewelry Company, Vietnam’s biggest gold processer and trader, bought the metal at VND41.85 million and sold at VND42 million as of 9.30am Vietnamese time.

Hanoi-based Phu Quy Jewelry Company purchased SJC-brand gold at VND41.92 million and sold at VND42.04 million as of 12.10pm Vietnamese time.

Bao Tin Minh Chau Jewelry Company quoted price at VND40.7 million for buying, and at VND41 million for selling at 12.45pm Vietnamese time.

Domestically, gold fetched VND1.6 million a tael, higher than global price.

On free market, the US dollar was bought at VND20,930 per dollar, and sold at VND20,950 per dollar, down VND10 per dollar over the previous day.

Meanwhile, Vietcombank bought the greenback at VND20,900 per dollar, and sold at VND20,950 per dollar, a decrease of VND20 from the previous day. Eximbank purchased dollar at VND20,870, and sold at VND20,930 per dollar, a drop of VND40 per dollar in buying price, and VND30 per dollar in selling price over the previous day.

Internationally, gold declined in tandem with other risk assets as investors were disappointed by the result of the Fed monetary policy meeting.

During its meeting yesterday, the Fed did not mention a third round of quantitative easing as investors expected. Instead, the Fed will extend its effort to depress borrowing costs by selling short-term bonds and buy longer-dated ones – known as "Operation Twist" -- by $267 billion through the end of this year.

In Asia, spot gold lost $7.5 an ounce to trade at $1,600.3 an ounce at 9.30am Vietnamese time.

Last night, gold for immediate delivery fell as much as $11.1 an ounce, or 0.7 percent, to close at $1,607.8 an ounce in New York.

Euro exchange rate against the US dollar was at nearly $1.27 a Euro in Tokyo this morning, unchanged as of the previous day.

Crude oil futures for July delivery slid $1.07 a barrel, or 1.3 percent, to trade at $80.38 a barrel at 10.30am Vietnamese time.

By Thuy Doan

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