Gold market demand quiet with recent strong gains in Vietnam

HANOI – Gold futures for the first time in six years broke the US $ 1,450 a year last week, gaining 1.75 percent last Friday and a total of 13.6 percent since May 28.

The strong growth of gold futures is attributed to the past speculation of a global economy outlook, and a growing political, geographical and economic tension.

Those developments, especially the Fed rate cut, feel the bond yield down and weakened the US dollar, which are the key factors making gold more expensive.

In addition, more tensions around the globe have driven investors away from risky assets like stocks and towards safety in gold. Meanwhile, the potential for a global economic slowdown has been boosted by the growth of the economy.

These negative factors are predicted to be more expensive than $ 2,000 an ounce at the end of the year.

VNĐ40 million per tael, equal to VND30 million ($ 1,290) year ounce

Since May 28, prices of gold products have reached about 10 percent at Phu Nhuan Jewelery JSC (NPC) to VND39.92 million for a year, equal to VNĐ29.94 million yen.

Vietnamese success with its anti-gold policy.

According to Phan Dung Khanh, director of investment consulting at Maybank's Kim Eng Securities Co Ltd, the domestic gold market may not have been up to eight years ago.

Vietnamese dong and foreign currencies, to zero percent US dollar savings yield and rate of tightening policies regarding the number of eligible businesses, he told Dau Tu (Investment ) newspaper.

According to banking expert Can Van Luc, the domestic gold market has become quite quiet in the first six months of the year but gained 10 percent globally and 6.3 percent in the domestic market.

In the past, they were only 2-3 per cent, he said.

The gold market has been controlled and the stability of the exchange rate has been increased, Luc said.

The domestic gold market had remained stable, economist Nguyen Minh Phong said, as he was not much difference between buying and selling.

The daily trading was stable, more, the central bank did not have to make public announcements to stabilize the market – that had been done before the market turned volatile, Phong said.

In addition, the decision to make a decision is particularly important, especially after the Fed cut lending rates, business insiders said.

Buying gold is somewhat risky in the short term while there are also other attractive options for investors such as securities, real estate and corporate bonds, they said.

Gold should be a long-term investment in the right moment, they said.

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