The State Bank of Vietnam (SBV) said in a statement released on May 25 that it is always ready to intervene in the gold market that has become volatile in recent days, according to a local newspaper.

The Saigon Times Daily on May 27 quoted a source as saying that the central bank has stocked up on a large amount of gold bars since late January. Therefore, the agency can organise gold auctions at any time, instead of importing gold from abroad.

SBV Deputy Governor Dao Minh Tu said in the statement that the domestic gold market had been stabilised since early this year. Gold prices have moved in tune with supply and demand on world and domestic markets.

The gap between local and international gold prices has sharply narrowed down, reaching a record low of around 1 million VND for each tael. However, domestic gold prices have sharply soared in recent days.

Having followed and analysed market information, the central bank has seen no major volatility in global gold prices as well as gold supply and demand on the market. The central bank has advised the public to stay vigilant against rumors circulated by ill-intentioned elements related to the gold, foreign currency and monetary markets to avoid incurring losses and doing harm to the economy.

Therefore, the market has become stable. Transaction volume has been declining while gold prices have lost 800,000-900,000 VND per tael compared to early last week.

However, gold prices have bounced back slightly since May 23.

The central bank is still keeping a close watch on the market. If strong volatility remains, the central bank will intervene in the gold market as it has enough gold in stock, Tu said.

Gold prices have run wild with buying demand surging over the past two weeks.

Saigon Jewelry Company (SJC) has reported daily transactions of around 3,000 taels, jumping three-fold against normal days.

However, Nguyen Cong Tuong, SJC’s deputy sales manager, said customers bought just 1,000 to 2,000 gold taels each day over the weekend, so it was easy for SJC to buy gold to balance its position. Many people still rushed to sell the yellow metal.

According to the central bank’s HCM City branch, local enterprises and banks bought around 138,500 gold taels while selling 141,000 taels from May 15 to 20, resulting in a net sale of 2,500 taels.

One tael is equivalent to 1.2 ounces.-VNA