The State Bank of Vietnam has vowed to narrow the gap between the domestic and global gold prices in an effort to stabilise the domestic gold market

In a statement released on June 7 morning, the central bank affirmed that it has enough ‘resources and determination’ to stabilize the gold market and control the disparity between domestic and world gold prices at an appropriate level.

After holding a number of gold auctions in April and May, SBV recently decided to sell gold to four State commercial banks and Saigon Jewelry Company that then sold gold to consumers at stable prices.

Such market intrvention moves proved effective, helping domestic gold bar prices to fall to VND74.98 million – VND76.98 million per tael (for buying and selling prices), and the gap between domestic and global gold prices to drop to approximately VND4 million instead of VND19-20 million as previously.

At many gold selling points, especially in southern localities, people have kept queuing to buy gold, but a small amount of gold bars have changed hands. Currently, there are persistent rumours of gold shortages, and the central bank affirmed that this is false information.

According to SBV, some people have hired others to line up at gold selling points to buy gold aimed at pushing up the price and enjoying the difference. Such an unhealthy practice will cause market instability and damage to the economy, said the central bank.

The State Bank of Vietnam is coordinating with the police to verify and strictly handle acts of market speculation and manipulation. It will also maintain the supply of SJC gold bars to meet the legitimate and legal needs of the people, said the bank.

The central bank said it is also enhancing inspections at credit organisations and gold and gemstones businesses, especially those in Hanoi and Ho Chi Minh City, and strictly handle violations if any.

The bank warned gold buyers should exercise caution and try to pick the right time to buy or sell the precious metal to avoid incurring losses and minimising risks, as gold prices are likely to dip further in the short term.