Gold retreats; black market dollar rebounds

The price of gold in Vietnam fell by VND150,000 per tael (1.2 ounces) over the previous day on October 18 as global price declined due to a stronger US dollar.

Sacombank Jewelry Company bought gold at VND44.06 million and sold at VND44.24 million as of 11:10 am local time.

Saigon Jewelry Company, the biggest gold shop in Vietnam, quoted the price at VND44.05 million for buying and VND44.25 million for selling.

Hanoi-based Phu Quy Jewlery Company purchased SJC-brand gold at VND44.13 million and sold at VND44.35 million at the same time.

Domestically, gold remained fetching VND2 million a tael higher than global price despite efforts of the central bank and continuous rises in interbank dollar exchange rate. However, there were mixed opinions about the difference between local and global prices among gold traders. Sacombank Jewlery Company considered a gap of VND200,000-400,000 per tael is reasonable, whereas the representative of Saigon Jewelry Company said the current gap barely ensures profits for jewelers. Firms would definitely suffer losses with a lower gap as global price sometime changed sharply, he said.

In the past five days, bullion almost moved flat, stalling at just above VND44 million. Trading on bullion market was muted.

The interbank exchange rate rose to VND20,723 per dollar this morning, an increase of VND15 per dollar over the previous day. Dollars were bought at VND20,930, and sold at VND20,925 at commercial banks. On black market, the rate also hiked. The greenback was bought at VND21,410 per dollar, and sold at VND21,460 per dollar, up VND30 per dollar from a day earlier.

Internationally, gold retreated on concern over the European sovereign-debt crisis after the Europe’s leaders failed to conclude a specific way out for the region’s turmoil in the summit meeting last weekend.

Gold for immediate delivery fell as much as $9.1 an ounce, or 0.5 percent, to close at $1,671.7 an ounce on the Comex in New York.

In Asia, the heavy metal weakly fluctuated this morning. Spot gold was traded at US$1,674.4 an ounce, up $2.7 an ounce over the closing price in New York, at 11 am Vietnamese time.
Crude oil futures traded at $86.29 a barrel on the New York Mercantile Exchange at 11:10 am Vietnamese time.

The euro exchange rate against the US dollar was below $1.38 a euro in Tokyo at the same time.

By Thuy Doan

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