Gold prices hit a new peak, but the market in Nghe An remains quiet.
(Baonghean.vn) - At the close of trading on December 4th, world gold prices rose close to $2,140 per ounce, and domestic gold prices reached a new peak of 74.5 million VND per tael. On the morning of December 5th, domestic gold prices fell sharply compared to the previous day. Gold prices are constantly fluctuating, while the gold market in Nghe An remains relatively quiet.
Early this morning (December 5th), from 6:30 AM to 9:00 AM, at gold and silver shops on Cao Thang Street (Vinh City), the price of gold was listed at 72.9 million VND/ounce (buying price) and 74.49 million VND/ounce (selling price) for SJC gold bars; and 6.1 million VND/tael (buying price) and 6.34 million VND/tael (selling price) for 9999 gold rings.
However, by 9:30 AM, the listed prices were sharply adjusted downwards, with gold prices falling below 74 million VND/ounce. Accordingly, the price of SJC gold decreased, currently listed at 72.7-73.9 million VND/ounce (buying and selling prices); the price of 9999 plain gold rings is at 61.65-62.25 million VND/ounce, a decrease of 800,000 VND/ounce.
“After a series of days at high levels, by 9:30 AM on December 5th, the price of gold had fallen below 74 million VND/ounce. Domestic gold prices reversed course and started to decline after world gold prices also plummeted due to profit-taking by investors. Currently, the spot price of gold on the international market is down to 2,033 USD/ounce, a decrease of more than 100 USD/ounce compared to the all-time high reached on December 3rd. Converted at the VND/USD exchange rate, the world gold price is currently equivalent to more than 60 million VND/ounce, about 2.5 million VND lower than the price of 24k gold in Vietnam and nearly 14 million VND lower per ounce than the price of SJC gold,” said Mr. Quang Huy, manager of a gold shop on Cao Thang Street.
Despite the constant fluctuations and occasional record highs in gold prices, the market in Nghe An remains very quiet, both in terms of buying and selling. Observations over the past few days show a low number of customers visiting gold shops; many shops are deserted. Reputable gold shops see more customers, but they are mainly buying wedding jewelry or checking gold prices rather than making large transactions.
With foreign currency sent home by her son, amounting to over 1.5 billion VND after conversion, unlike previous periods when Mrs. Trinh Thi Hoa (Thanh Chuong) would buy gold bars to hoard and save capital for her son, this time she decided to deposit it in the bank.
"Gold prices are soaring, and I don't understand market dynamics, so I don't dare take the risk. At this time, even with low interest rates, I'd rather put my money in a savings account for safety. I'll wait until gold prices stabilize before buying, or I might consider investing in real estate to provide capital for my children," Ms. Hoa said.
After learning about the soaring gold prices, reaching 74.5 million VND per SJC gold bar and 6.35 million VND per 9999 gold ring, Mr. Ho Huy Loi from Ha Huy Tap ward (Vinh City) visited several gold and silver shops to check prices.
According to Mr. Loi, after selling his land at a good price in 2021, he bought gold to store. At that time, the price of gold was 57 million VND per tael. Now, if he were to sell it, he would have made a profit of nearly 17 million VND per tael.
However, he is still hesitant to sell because gold prices are predicted to rise sharply in the near future. "It's our asset for self-protection. We'd like to sell it when we make a profit, but we've heard that gold prices will continue to rise sharply, so we're not in a hurry," Mr. Loi shared.
Having been in the gold and silver business for many years, Ms. Kim Dung, the owner of a gold shop on Le Loi Street (Vinh City), said: "Although the price of gold has continuously increased and sometimes set new records, the number of customers at our system has not increased and is even trending downwards."
The reason is that gold prices are constantly fluctuating, making investors hesitant to "put down money." Additionally, at the end of the year, businesses are stocking up on goods for Tet (Lunar New Year). The warming real estate market is also causing many people with idle money to invest in land. Therefore, gold shops are only conducting small-scale transactions, with no large-scale sales deals.
On the buying side, prices only increased slightly. Some people with gold reserves took advantage of the high price to sell and lock in profits, while the majority still believe that gold prices will continue to rise and are not in a hurry to sell. Furthermore, unlike in major cities, in Nghe An, most people buy gold as an asset or for self-protection; there are still relatively few genuine gold investors.
BMI – the market research arm of data specialist Fitch Solutions – stated: "We believe that the main factors supporting gold prices in 2024 will be a US Federal Reserve interest rate cut, a weaker USD, and heightened geopolitical tensions." Gold is often favored during periods of socio-economic upheaval because it does not depreciate in value in any economy.
Bart Melek, head of commodity strategy at TD Securities, an investment bank, forecasts that the average price of gold will reach $2,100 per ounce in the second quarter of 2024. He believes that strong buying by central banks will reinforce the upward trend in gold prices.
The latest survey by the World Gold Council (WGC) shows that 24% of global central banks plan to increase their gold reserves in the next 12 months. They are increasingly skeptical about the role of the US dollar as a reserve asset.
