Bullion surges to VND40 million again

The price of gold in Vietnam hit VND40 million again on July 29 as global price recovered on concerns over a possible US default.

The price of gold in Vietnam hit VND40 million again on July 29 as global price recovered on concerns over a possible US default (Photo:.U. Phuong)

Hanoi-based Phu Quy Jewelry Company bought the metal at VND39.91 million and sold at VND40 million as of 9:40 am local time. Saigon Jewelry Company quoted the price at VND39.93 million for buying and VND40 million for selling at the same time.

Recently, the movement of domestic gold price totally depended on global price. Exchange rate and the relation between supply and demand almost did not affect the price as exchange rate was rather stable for several days while the current buying and selling demand were not strong.

Domestically, gold fetched around VND150,000 a tael lower than global price. Internationally, gold slightly advanced as a potential US debt default spurred demand for the metal as a safe-haven.

Gold for immediate delivery gained as much as $3.1 an ounce to close at $1,618.2 an ounce on the Comex in New York. Earlier, the metal sank to near $1,600 an ounce due to profit-taking.

In Asia, the metal started the day with a slight drop, however, it soon made a U-turn this morning. Spot gold was traded at above $1,618 an ounce as of 9:45 am Vietnamese time.

A House of Representatives vote on Speaker John Boehner’s deficit-cutting plan was delayed again yesterday, further eroding the time left to craft a deal. Senate Democrats have said they will kill the proposal, while President Barack Obama has threatened a veto. The US borrowing authority expires on August 2.

Moody’s Investors Service today placed Spain’s rating on review for a possible downgrade. Standard & Poor’s yesterday joined Fitch Ratings and Moody’s in cutting Greece’s credit rating, saying the nation will partially default. All three agencies have said they will downgrade the US’s AAA rating should a failure to raise the borrowing limit lead to a default.

Meanwhile, debt turmoil was spreading to Italy. Italian-10-year bond yields strongly rose on concern that the country would join Greece in the sovereign-debt crisis.

SPRD Gold Trust bought 18.2 metric tons, rising its holdings to nearly 1,263 metric tons, the company’s website showed.

The euro exchange rate against the US dollar remained at $1.43 a euro in Tokyo this morning.
This morning, crude oil futures for September delivery lost $0.17 a barrel to trade at $97.27 a barrel as of 9:35 am Vietnamese time.

By Tuong Anh

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