Vietnam central bank ready to tackle soaring local gold prices

HANOI  – Vietnam’s central bank on Thursday said it stood ready to intervene in the local gold market as soaring domestic prices of the metal prompted a rebuke from the country’s prime minister.

The price of gold in the Southeast Asian country has gained nearly 20 percent since the beginning of the year, reaching a peak of 80 million dong ($3,292.86) per tael on Tuesday.

The State Bank of Vietnam (SBV), the country’s central bank, said both bid and ask prices were rising but the gold bar market was not seeing abnormal fluctuations.

“It was because domestic prices were following global cues but at a bigger pace,” the SBV said in a statement, adding it “stands ready to intervene to stabilize the prices”.

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The SBV also warned people to be cautious with gold transactions amid the “complex and unpredictable market”.

Earlier on Thursday, Prime Minister Pham Minh Chinh said the high prices had negatively impacted market sentiment and ordered the central bank to tackle the issue more effectively.

“The State Bank has to have healthy, effective solutions to stabilize the market,” he said in a statement.

One Hanoi-based stock broker said many of his clients were withdrawing money from bank accounts to invest in the safe haven that is gold.

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“Stock market is gloomy, so is real estate market while deposit rates are exceptionally low. Therefore many are turning to gold as a safer bet,” he said.

After the prime minister’s order was released, at 0702 GMT, SJC gold bar prices dropped to 76 million dong per tael, compared with opening price of more than 79 million dong per tael.

Gold traded at $2,087 per ounce on the global market as of 0714 GMT on Thursday.