The Ever-Rising Gold Price: To Control or Let Go?

Domestic Gold Price Moves Counter to Global Trends

As of 10 am today, global gold prices took a downturn, falling to $3,550 per ounce. This marks a $2 decrease from the early morning and a $6 drop since yesterday morning. The global gold price currently equates to approximately 113 million VND per tael.

However, domestic gold prices continue their upward surge to new record highs. Saigon Jewelry Company (SJC) listed its gold bars at 132.9 – 134.4 million VND per tael, an increase of half a million VND on both buying and selling prices since the early morning.

Since the beginning of August, SJC gold bar prices have risen by 13 million VND. Moreover, since the start of the year, prices have skyrocketed by nearly 50 million VND.

Gold ring prices have also witnessed robust increases over the past month, reaching new peaks daily. Specifically, Bao Tin Minh Chau Jewelry Company listed its gold rings at 126.8 – 129.8 million VND per tael, a 300,000 VND surge since the early morning. Phu Quy Jewelry Company followed suit, pricing its gold rings at 126.5 – 129.5 million VND per tael.

Surprisingly, as gold prices heat up, the black market for gold is thriving. Small-scale gold shops are offering SJC gold bars at 139 million VND per tael. Instead of queuing and facing purchase limits at authorized dealers, many investors are turning to this unofficial channel to buy unlimited quantities, despite prices being 3 to over 4 million VND higher per tael.

These are the highest prices ever recorded, even after the government issued Decree No. 232/2025, amending and supplementing several articles of Decree No. 24/2012 on gold business management. Notably, the new decree includes provisions such as the abolition of the State monopoly on gold bar production and the import of gold materials for gold bar production.

However, shortly after the decree’s issuance, the market sentiment remained largely unaffected, with gold prices continuing their upward trajectory and no signs of mass gold selling by the public. Past experiences, particularly last year’s events, suggest that only when the State Bank starts selling gold to commercial banks for distribution in the market will prices truly drop.

Letting the Market Self-Regulate?

Analysts believe that the market needs time to absorb the new policy. Once the decree takes effect in October 2025, the State Bank will issue a circular providing specific guidance on its implementation, including the licensing process for gold bar production and the import of raw materials. Only when the public observes the State Bank granting import licenses for gold raw materials and setting quotas, as well as the developments in gold bar and ring production, will prices begin to adjust. However, these steps will take time.

In a conversation with Tien Phong, Mr. Nguyen Duc Do, Deputy Director of the Institute of Finance and Economics, Finance Academy, shared his thoughts on the unpredictability of domestic gold price movements, which are influenced by various factors such as global gold prices and consumer demand.

According to Mr. Do, it is challenging for gold prices to cool down immediately due to the persistent scarcity of supply. He added that the State Bank’s decision not to import gold is understandable, as the authorities must consider the exchange rate equation. Currently, the USD exchange rate is also experiencing a surge. Importing gold without knowing the exact demand from the public could be challenging.

The Deputy Director emphasized that the State Bank’s primary objective remains maintaining exchange rate stability to ensure economic stability. He suggested that the gold market be left to self-regulate. Gold prices cannot rise indefinitely, and when a downward adjustment occurs, consumer demand will decrease, naturally narrowing the gap between domestic and global gold prices.