The gap between the gold price in the domestic and global market has hit the highest level in years due to a restricted supply and rising local demand.
A trader checks a gold ring at a shop in Ha Noi.— Photo zingnews.vn
On Monday, while the gold price in the world market stayed unchanged against the previous week, the domestic price of the metal kept rising significantly, thus widening the international and domestic price gap to VND12.3 million per tael.
The world gold price on Monday was stable at around US$1,780 per ounce. If including taxes and fees, a gold tael was equal to VND49.2 million. The international price plummeted last week amid the strong rise of the greenback and US Treasury bond yields. Experts believe that concerns over the US Fed’s new action with monetary policy also caused the gold price to decrease.
However, gold prices in the domestic market were listed at VND61.5 million per tael on Monday, up some VND500,000 against late last week.
On Monday, gold bars were traded by SJC Jewellery Co at VND61.5 million per tael for selling and VND60.8 million for buying, up VND400,000 against last Friday. This was the fourth consecutive gaining session of SJC gold bars since the middle of last week to date, lifting the total rise of the metal to nearly VND1 million per tael.
Phu Nhuan Jewelry Joint Stock Company (PNJ) increased the gold price for the fifth consecutive session on Monday after many days of decline in the second half of November. The company listed buying price at VND60.7 million per tael and VND61.4 million for selling price, up VND500,000 and VND400,000 against the end of last week, respectively. The prices were the highest levels that PNJ listed with gold bars in the past two weeks.
Domestic prices were usually higher than the world prices in previous years, but the price gap was no more than 10 per cent. So the current more than 20 per cent is a surprise.
Analysts attribute the unexpected rise to short supply and high demand for hoarding gold as an asset in the domestic market.