Gold prices in free fall

By Dat Nguyen December 27, 2023 | 11:42 pm PT

A person holds gold jewelry at a shop in Ho Chi Minh City. Photo by VnExpress/Quynh Tran

Gold bar prices experienced a decline on Thursday afternoon, following a directive from Prime Minister Pham Minh Chinh to minimize the disparity between domestic and international gold prices.

Saigon Jewelry Company (SJC) gold bar slipped 4.40% from Wednesday to VNND76 million ($3,127.25) per tael as of 2:30 p.m.

The precious metal is now 5.35% lower than the historic peak it established on Tuesday.

Late Wednesday, PM Chinh instructed the State Bank of Vietnam and other relevant authorities to ensure that domestic gold prices are aligned with market demands and do not significantly exceed global rates.

On Tuesday, when gold bars reached their peak, they were priced nearly 33% above the global rate.

Analysts note that Vietnam's gold prices have surged over the past two months, experiencing a significant increase this week, due to escalating demand against a backdrop of largely unchanged supply for several years.

An expected decline in the U.S. Federal Reserves’ policy rates will likely weaken the U.S. dollar and strengthen the precious metal, and gold investors therefore have been snapping up bars with expectations of a higher rate next year.