Central bank lower gold prices to stabilize market

The State Bank of Vietnam (SBV) on June 4 cut the prices of SJC-branded gold bars sold to four State-owned commercial banks and the Saigon Jewelry and Germ Stone Co. (SJC) by VND1 million ($39) per tael for sale to the public.

The gold bars were offered by the central bank at VND77.98 million ($3,069).

As a result, the four banks of Agribank, BIDV, VietinBank and Vietcombank and the SJC also reduced the prices of gold bars sold to the public by VND1 million to VND78.98 million per tael.

The four banks and the SJC started to sell gold bars to the public from June 3 under a license from the central bank. They bought gold from the SBV for VND78.98 million per tael, and sold it to the market at VND79.98 million.

The four banks noted that they will only sell SJC-branded gold bars to individual customers but will not buy those gold bars back from the latter. The SJC will buy those gold bars, however.

Earlier, the SBV said the four banks and the SJC are solely permitted to purchase SJC gold bars from the central bank to sell to the public as part of measures to stabilize the market.

The SBV said it will continue to follow the roadmap to narrow the difference between the domestic price of SJC gold bars and the world price.

On June 4, the selling prices of the SJC-branded gold bars continued to drop to VND78.98 million ($3,103) per tael, down VND1 million ($39) per tael compared to the previous day.

Meanwhile, the buying rate was down by VND1.3 million ($51) to VND77.7 million ($3,053) per tael.

At this level, gold prices in Vietnam are around VND7 million ($275) a tael higher than world prices, significantly lower than a gap of VND20 million ($785) at a peak recorded earlier this month.