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Strong demand drives up local gold prices – report

The Saigon Times

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HCMC – Vietnam’s increasing demand for gold is impacting market dynamics, resulting in record-high quarterly prices, according to the World Gold Council’s Gold Demand Trends report in Q1.

Data showed the first-quarter demand for gold bars and rings for investment purposes in Vietnam rose by 12% year-on-year, contributing to a 6% overall increase in consumer demand.

The average quarterly gold price reached a record of US$2,070 per ounce, driven by factors such as escalating energy costs, a weaker Vietnamese dong, and gold’s status as a safe-haven asset for local investors, the report noted.

This surge in demand has led to unprecedented premiums on gold bars, reaching US$650 per ounce, prompting the Government to relax restrictions on gold supply.

Shaokai Fan, head of Asia-Pacific (ex-China) and global head of Central Banks at the World Gold Council, said currency devaluation has been a common theme among the markets in ASEAN. “This fuelled safe-haven demand for gold and attracted investors with superlative returns in local prices.”

Meanwhile, gold jewelry demand in Q1 fell for the fifth year in a row, hitting the lowest first-quarter mark since 2015 as high prices deterred buyers.

Louise Street, senior markets analyst at the World Gold Council, said if the gold price stabilizes in the coming months, price-sensitive investors may return to the market, while others will continue to view gold as a safe haven amidst ongoing geopolitical and macroeconomic uncertainties.

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