Vietnam's gold demand increased in the second quarter

The World Gold Council (WGC) estimates that demand in Vietnam in the second quarter was estimated at 23.2 tons, up 24% over the same period last year, but lower than the amount of gold sold by the State Bank during the same period.

The World Gold Council (WGC) today released its report assessing global gold demand for the second quarter. This is part of the WGC's regular survey. The figures are estimates based on market demand and are not based on the actual gold imports of each country.

In Vietnam, WGC estimated that gold demand in the second quarter reached 23.2 tons, equivalent to more than 1 billion USD, up 24% in volume and 9% in price compared to the same period last year. Of which, both jewelry and investment gold increased, in contrast to the first quarter, when purchasing power decreased by 17% due to the Government's gold control regulations and cooling inflation.

However, compared to other countries in the Asian region as recorded by the WGC (including China, India, Thailand, Japan, Indonesia, and South Korea), Vietnam's increase is only higher than Thailand's. And the WGC's estimated demand figures are far lower than the amount of gold sold by the State Bank. In the second quarter, the State Bank sold a total of nearly 49 tons to banks and businesses through bidding.

In general, in the past year, the demand for gold in Vietnam reached 77.4 tons (3.9 billion USD), down 26% compared to the same period. Of which, the demand for gold bars and gold coins for investment accounted for nearly 86%.

Globally, gold demand fell 12% to 856.3 tonnes in the second quarter, a 23% decline in value to $39 billion, a three-year low. The main reason was a massive sell-off by gold trusts, although this was mitigated by dip-buying (mainly in bars and coins) in April and June, during which the price of gold fell more than $400 per ounce.

Continuing the trend from the previous quarter, demand for gold jewelry also increased sharply to 575.5 tons, a five-year high. Meanwhile, gold supply decreased by 6%, mainly due to a decrease in recycling.

Low inflation and the possibility of the US Federal Reserve (FED) reducing the size of its stimulus package, causing US Treasury bond yields to rise, have caused funds and many investors to seek to exit gold in recent months. Billionaire John Paulson's investment fund reduced its shares in the world's largest gold trust fund - SPDR Gold Trust - by 53% in the second quarter. Meanwhile, billionaire George Soros sold all of his shares here.

Gold jewelry demand is influenced by many factors, such as economic growth, consumer sentiment and income. However, the WGC believes that the fall in gold prices is the cause of the gold jewelry buying fever in the quarter, especially in India and China. These two countries account for 60% of global gold jewelry demand and 50% of investment gold demand in the second quarter.

Central bank purchases fell significantly. While they remained net buyers in the second quarter, they only brought in 71 tonnes, down sharply from 109 tonnes in the previous quarter and 164.5 tonnes in the same period last year. Purchases were concentrated in the Commonwealth of Independent States (CIS), with Russia the largest buyer at 15 tonnes.

According to the WGC, price volatility, weakening emerging market currencies and falling foreign exchange reserves at many central banks are the reasons for this decline in demand. However, the agency also predicts that central banks will continue to be net buyers of gold in the coming time.

According to VnExpress - TH