In a gold auction yesterday Vietnam’s State Bank managed to offload 8,100 taels of gold just shy of half of what was on offer.  Each tael went for about VND 87.7 million or US$2,126 each. Gold bars are currently retailing for about VND 90 million or US$3,535 a piece.

This latest development is a vast improvement with a series of past gold auctions selling only a few thousand gold bars or being cancelled altogether due to lack of interest. The change of circumstances is likely due to changes to this gold auction that saw the minimum order significantly reduced.

Gold auctions have been touted as a means to stabilise the local gold market, however, it is not clear exactly why that might be necessary with gold having little practical utility. It has, however, become a key focal point of the local media in recent months nonetheless.

For some background, the gold price in Vietnam is often much higher than the world gold price, currently about 15 percent higher. This is due to Decree 24 issued in 2011 which restricted gold imports and exports to one company–SJC–that can only do so with permission from the State Bank of Vietnam. Permission to import gold, however, has not been granted for over a decade. This has led to a mismatch in supply and demand pushing up the price.

For more information see: The Gold Price in Vietnam: Explained 2024