Gold prices in Vietnam rallied for the second day on August 20 as global prices slightly rose on a weaker US dollar, prompting investors to seek the metal as an alternative investment.
Bullion advanced by VND10,000-20,000 a tael (1.2 ounces), while jewelers continued to keep a narrow range of VND50,000 a tael between selling and buying prices to boost trading volume.
Sacombank Jewelry Co. bought gold at VND21.18 million and sold at VND21.20 million.
At Saigon Jewelry Co., gold was bought at VND21.17 million and sold at VND21.22 million.
The VND21 million mark was considered a barrier to the recovery of bullion’s trading volume. Investors said the prices remained high and contained many risks to pump money into it.
Meanwhile other higher-yielding investment channels like stock markets, real estate and the dollar have also drawn much attention from investors.
However, with the approaching wedding season, the demand for jewelry has covered the poor demand for bullion.
Trading remained high on gold exchanges.
On the SBJ trading floor, more than 321,000 taels changed hands at VND20.07-20.29 million by 9:45am local time.
Globally, spot gold gained $3.4 an ounce more than the previous day, 0.4 percent, to close at $942.5 an ounce.
In Asia, gold for immediate delivery swung around $942-943 an ounce this morning.
“The bullion selling pressure has appeared with the enhancement of the greenback and weakened stocks,” James Moore, an analyst at TheBullionDesk.com in London, said.
Bullion may retreat to $920 in the future, he said.
According to Bloomberg, the US Dollar Index, a six-currency gauge of the greenback’s value, fell as much as 0.6 percent.
The dollar exchange rate against the euro dropped to a little above $1.42.
Crude oil advanced to $72 a barrel due to an increase on the US’s stock markets and a sharp decline of the country’s oil reserves.
Crude oil futures for September delivery rose as much as $3.23, five percent, to $72.42 a barrel on the New York Mercantile Exchange.
A report by the US Department of Energy said crude oil reserves fell by 8.4 million barrels to 343.6 million barrels, the highest decline since May 2008. Meanwhile, gasoline reserves have also dropped by 2.18 million barrels to 209.8 million barrels.
Crude oil imports into the US fell by 1.41 million barrels a day last week, to 8.11 million barrels a day, the lowest level since September 2008.