Gold price 'dancing', Nghe An market trading quiet

The price of this precious metal has been constantly fluctuating in recent times. Photo: Thanh Phuc

Early August 2021,world gold priceas well as domestic prices continuously fluctuated. Opening the first trading session of the month, gold prices turned to decrease after a period of continuous strong price increases. Accordingly, the listed prices at reputable gold and silver corporations in Nghe An were around 57.5 - 57.7 million VND/tael (sell) and 56.9 - 57 million VND/tael (buy). On August 2 and 3, gold prices continued to decrease, remaining at 57 - 57.3 million VND/tael (sell) and 56.5 million VND/tael (buy).

However, by the morning of August 4,Gold prices show signs of rising again,a slight increase, only about 120,000 - 150,000 VND/tael. Accordingly, at gold and gemstone companies in Vinh, the listed price of SJC gold is 56.7 million VND/tael (buy) and 57.5 million VND/tael (sell). Although the gold price has increased slightly after a long period of fluctuation and remained high compared to previous months, the number of people coming to trade at gold shops is very small, the gold market is quite gloomy and quiet.

Although the price of gold increased slightly on the morning of August 4, there were still very few customers coming to trade. Photo: Thanh Phuc

In front of the main gate of Vinh market, where Nghe An's large gold, silver and gemstone businesses are concentrated, there are only a few stalls with a few people coming to trade, the small retail stores are deserted. Mr. Dang Tuan Vu, owner of a gold, silver and gemstone business on Cao Thang Street (Vinh City) said: "Since the Covid-19 epidemic broke out strongly in the country and many localities in the province, the buying and selling of gold has also been strongly affected. Accordingly, the number of customers has decreased significantly."

According to Mr. Vu's analysis, the main reason is due to economic difficulties, few people have enough money to invest in this precious metal, moreover,Gold prices fluctuate constantly, unpredictable, so people with money are also afraid to buy gold for storage. Meanwhile, in countries around the world, the epidemic broke out strongly, the jobs of many exported workers were stagnant, salaries and bonuses were also cut quite a lot, so the amount of remittances sent back also decreased, people did not have surplus financial resources to buy gold for storage.

As for investors who have gold reserves, they are not in a hurry to sell at this time because they do not have enough to make a profit, and if they sell gold, they do not know what feasible investment field to invest in during the difficult period caused by the epidemic.

Customers mainly come to buy gold jewelry or buy a few in retail for necessary use. Photo: Thanh Phuc

According to research, recently, customers coming to trade are mainly individual customers who come to buy gold jewelry or buy a few taels for savings. And for them, the price going up or down is not too important. Ms. Nguyen Hoang Thu Dung, a customer, said: “I just received a one-time payment and it is my turn to receive money from the ward, the total is nearly 60 million VND. With that extra money, I bought gold to store. The price of gold increasing by a few hundred thousand VND/tael is not important, because buying it is to “save” for when I am sick or in trouble, so I do not pay too much attention to the ups and downs of gold.”

Meanwhile, jewelry items such as rings and earrings have better trading power. "After the epidemic was controlled, wedding activities resumed in some places, so round rings and gold jewelry sold better, but there were no large transactions," said Ms. Manh My Duyen, owner of a gold and silver shop on Tran Phu Street.

On August 3, after the International Monetary Fund (IMF) approved 650 billion USD to support some countries affected by Covid-19, the USD weakened compared to many other currencies but the world gold price still decreased. Some analysts said that this information could prompt the US Federal Reserve to gradually reduce its move to release 120 billion USD into the market each month to buy assets to support the economy to overcome the epidemic. At that time, the currency market will have a certain reaction, strongly affecting the trend of gold prices.

Therefore, at this time, financial investors are focusing their capital on stocks, helping stock prices in the international market increase sharply. This shows that the flow into the gold market is very modest. Gold prices lack the motivation to increase.