Gold prices continue to rise, so be cautious when investing and taking profits.

"Surfing" when gold prices increase

On October 22, early morning, recorded at 7:15 am, the gold price at Doji was listed at 70.3 - 71.1 million VND/tael (buy - sell), unchanged compared to yesterday afternoon (October 21). Meanwhile, the gold price at SJC was listed at 70.25 - 71.05 million VND/tael (buy - sell), an increase of 100,000 VND/tael in the selling direction.

In general, during the week from October 16 to October 22, domestic gold prices increased by 400,000 - 950,000 VND/tael and established the third consecutive week of increase. During economic difficulties, many people believe that gold will be a safe haven, so there is a phenomenon of "surfing" investment according to gold prices.

Ms. Han Thi Binh, owner of Kim Phat Manh I private gold business in Ho Chi Minh City, said that recently, the market has seen many amateur gold "surfers". They often follow the international market, if the world gold price goes up, they will buy SJC gold bars with the expectation that this type of gold will increase in price even more.

"When SJC gold reaches its target price, the traders will quickly sell to take profit. The price of SJC gold will drop in the blink of an eye. Therefore, at this time, those who do not understand the market and buy SJC gold may be at a disadvantage," said Ms. Binh.

Last week, the domestic market for both SJC gold bars and gold rings fluctuated strongly.

In mid-October 2023, Ms. Ho Thi Phuc, living on Nguyen Dinh Chieu Street, District 3, Ho Chi Minh City, withdrew her savings to buy nearly 6 taels of gold, saying: "I have a little money, I used to deposit it in the bank but now I see that the gold price is high so I withdrew the money to buy. I also do not buy or sell gold, but I keep it as an asset so that when I need money, I can sell it for more value."

Meanwhile, Mr. Nguyen Van Dat, living in Tan Binh District, Ho Chi Minh City, is in need of money so he is selling 5 taels of SJC gold. However, Mr. Dat said he will continue to monitor and invest in gold in the near future because, according to him, the price of gold will continue to increase.

"I bought gold about 2 months ago, now I'm selling it to take profit. In my opinion, the gold price will continue to increase, I'm still holding some gold and observing, depending on the situation in the future, I can buy gold or sell gold," Mr. Dat shared.

Financial expert, Dr. Nguyen Tri Hieu, assessed that currently, the difference between domestic and international gold prices is too high. This difference is due to the lack of connection between the Vietnamese and international gold markets. Along with that, many years of not importing gold has caused the demand for gold to lack the supply of SJC gold bars.

“Enterprises keep gold prices high, pushing risks onto buyers. Not only is the price difference with the world high, but the difference between buying and selling is also high, making the final loser still the customer. Therefore, now is not the right time to invest in gold. Only when the difference drops to a reasonable level, people should invest in gold,” Mr. Hieu pointed out.

Stabilize the gold market

By the end of October 2023, the State Bank was still consulting with gold trading enterprises and economic experts to summarize and evaluate gold management regulations. The State Bank has recognized the story of gold management to create stability in macroeconomic management, thereby controlling inflation, controlling the gold market, not affecting the price level and other indicators.

In a report sent to the National Assembly in early May 2023, State Bank Governor Nguyen Thi Hong informed about the summary and assessment of the implementation of Decree 24/2012/ND-CP on the management of gold trading activities.

Accordingly, the State Bank said it has organized inspections and examinations nationwide to rectify gold trading activities, handle violations within its authority, and request the correction of problems discovered after inspections and examinations.

Speaking with Nguoi Dua Tin, Mr. Huynh Trung Khanh, Vice President of the Vietnam Gold Trading Association (VGTA), said that after more than 10 years since Decree 24 was issued with regulations on the gold market, the situation has changed, so adjustments are needed to clear the gold market and narrow the gap between domestic and international prices.

"Currently, the domestic gold market is stable, so opening the gold market will achieve the goal of balancing supply and demand in the market, and cannot be said to affect the foreign exchange market as well as the VND exchange rate. At the same time, the State Bank has also controlled the exchange rate to be stable, even when there is pressure, the exchange rate is still stable," Mr. Khanh stated his opinion.

If gold is allowed to be imported, Mr. Khanh said that first of all, there needs to be a policy to allow the import of raw gold so that businesses can produce and trade gold jewelry domestically instead of collecting smuggled goods. Because, if the door is not opened, unofficial gold sources will still enter the market when domestic gold supply is scarce and prices are higher than international prices.

An expert who worked for a gold import unit in 2010 also commented: “People’s habit of keeping gold always exists. If we just limit the places where gold bars are sold, people will not keep gold, especially in the unstable global economic situation, when international gold prices continue to increase.”

The tradition of storing gold still exists and continues to be strengthened in the context of economic fluctuations, inflation... gold always has high value. And, the situation of uncontrolled gold smuggling, massive collection of USD to import gold causing the exchange rate to increase, affecting other imported goods, VND devaluation... are inevitable consequences when the domestic gold market is not connected with the world.

Source: https://www.nguoiduatin.vn/gia-vang-tiep-da-tang-nen-than-trong-dau-tu-chot-loi-a632141.html