SBV: It’s not time to import gold

Speaking to the Daily on Thursday, a leader of the central bank said that SBV will arrange a pilot gold auction today but just among units of the agency. SBV will pilot the auction with registered organizations next week before launching official bidding.

However, SBV has to realize this scheme soon as it has to supply gold for the market to narrow down the gap between local and international gold prices. The gold amount supplied by SBV will not be high as gold demand on the market stays low.

Concerning risks in gold trading on the world market, the official said that SBV has gained experiences in connecting with the international market to regulate foreign reserves. Besides, the agency has had solutions to prevent risks.

Nguyen Cong Tuong, deputy sales manager of Saigon Jewelry Company (SJC), said that the gap between local and international gold prices dropped to only VND2.5 million for a tael on Thursday. Local people flocked to buy gold as the precious metal declined.

SJC on Thursday saw its selling volume four timers higher than that of buying, making SJC’s gold selling price rise from VND43.05 million in the morning to VND43.3 million per tael at the end of the afternoon and widening the international-domestic price gap to VND3 million. However, the yellow metal closed down by VND400,000 per tael against the previous day.

Watching recent developments on the gold market, an expert in the gold industry said that SBV’s first steps to stabilize the market have achieved positive results, narrowing down the difference between the world and local gold prices from a record of VND5 million to around VND3 million a tael. Compared to the same period of last year, people’s buying has sharply dipped.

After June 30 when all banks have completed the closing of their gold accounts, gold demand will drop back, further reducing the gap between local and international prices.

However, it is difficult to cut the gap to under VND1 million a tael. To realize this target, the nation must establish a gold exchange floor which will operate like the stock market under the supervision of the central bank.