Gold gains on dollar weakness, oil recovery

Gold prices remained steady on July 21 after surging by VND200,000 a tael (1.2 ounces) to VND21.20 million the previous day as the US dollar continued its downward journey.

Most gold shops bought at VND21.15 million and sold at VND21.20 million, or around VND800,000 higher than global prices, but the trading volume was muted.

Sacombank said a breach of the VND21.30 million mark could see investors selling large volumes.

Duong Duc Hien, deputy general manager of Phu Quy Jewelry Co., said with the high bullion prices acting as a deterrent, investors have begun to turn their sights on other assets like equities and real estate.

But volumes remained high on the SBJ gold exchange where more than 225,000 taels were traded at VND20.34-20.50 million.

Globally, the yellow metal climbed to a five-week high due to the greenback’s decline and hardening oil prices.

Spot gold gained $11.4, or 1.2 percent, to $950.1 an ounce. Gold futures for August delivery gained $11.30, or 1.2 percent, to $948.80 an ounce on the New York Mercantile Exchange.

Earlier, the price reached $955.40, the highest for a most-active contract since June 12.

In Asia, gold hovered at $949-950 an ounce.

The biggest exchange-traded fund backed by bullion, SPDR Gold Trust, sold 0.31 tons, reducing its gold holdings to 1,094.54 tons.

The US Dollar Index, a six-currency gauge of the greenback’s value, fell to a six-week low on speculation that European and US economic reports this week will show the global recession is easing, sapping demand for a refuge from risk.

The dollar remained at $1.42 against the euro July 21.

Oil rose to $64 a barrel again, thanks to some positive economic information and a recovery in the US stock markets.

Crude oil futures for August delivery advanced 50 cents, or 0.78 percent, to $64.48 a barrel.

Earlier, oil closed the trading session in New York at $63.98 a barrel, the highest level since July 6.

Compiled by Thuy Doan

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