HCMC — Domestic gold buyers have faced a brutal week, losing VND15 million (over US$570) per tael as a result of a global sell-off.
Since March 16, the fear of missing out (FOMO) has brought large numbers of people to gold shops as SJC-branded gold soared to record highs earlier last week. However, the market took a U-turn, plunging from its VND183 million peak to around VND168 million this morning, leaving buyers with heavy losses in less than seven days.
The domestic price crash was partly fueled by a US$300 plunge in global prices on March 19, sending gold diving to US$4,500 per ounce, the sharpest drop since early February. Analysts attribute this “black Thursday” to shifting central bank policies and a stronger dollar, as the Middle East conflict failed to provide its usual safe-haven support.
This volatility exposes the multi-layered risks within the domestic gold market. First is the staggering premium of SJC gold, currently trading over VND30 million higher than the global equivalent (VND142.7 million per tael). This gap has created a significant risk of a sharp correction should regulators intervene to narrow the spread.
Furthermore, the persistently high buying-selling spread means investors incur an immediate loss upon transaction. This adds immense pressure to short-term speculators, as prices must surge significantly just to reach the break-even point.
