VINACHEM

The central bank will continue to supply gold for the market through auctions but the volume put up for sale will drop back given the falling demand, said Le Minh Hung, deputy governor of the State Bank of Vietnam.

Hung said banks have settled all gold deposit accounts and will continue to deal with gold loans in the coming time estimated at around nine tons.

However, banks have no need to buy gold to settle gold arrears. Therefore, the demand for gold of banks will decline sharply.

So, the central bank will offer around 26,000 gold taels for each auction, not 40,000 taels like before.

Nguyen Ngoc Trong, sales director of Phu Nhuan Jewelry Company (PNJ), said that banks bought smaller gold volume in the bidding on Tuesday. Enterprises bought up around 10,000 taels out of 40,000 gold taels put up for sale while earlier, enterprises found it hard to compete with banks at previous sessions.

Gold supply to the market will increase if the central bank continues to organize auctions, which may help narrow the gap between local and international gold prices, Trong said. Gold demand is low now, with PNJ selling just around 400 taels of gold each day this week.

Since March 28, the central bank has auctioned off over one million taels, equivalent to around 42 tons of gold.

In related news, Nguyen Hoang Minh, deputy director of the central bank’s HCMC branch, said that HCMC authorities have detected three gold smuggling cases over the past six months. Gold trafficking is more active in border provinces rather than in HCMC.

Saigon Jewelry Company (SJC) closing the day posted up gold prices at VND37.3 million and VND37.6 million per tael for buying and selling respectively, down a slight VND100,000 against the previous day.

The Greenback price also declined on the unofficial market. On Wednesday afternoon, currency exchange points at Ben Thanh Market in HCMC bought a U.S. dollar at VND21,600 and sold it at VND21,650, down around VND250 against early this week.

Meanwhile, banks bought the greenback at VND21,240 and sold it at the ceiling price of VND21,246.

Overseas remittance to HCMC hits US$1.9 billion

Overseas remittance via HCMC-based banks in the first six months of this year reached US$1.9 billion, up 3% against the same period of 2012.

Nguyen Hoang Minh, deputy director of the central bank’s HCMC branch, said that this is a positive sign as remittance inflow usually moves up in the fourth quarter before the Lunar New Year holiday. Therefore, this year’s total remittance to the city is expected at US$4.5-4.8 billion, higher than last year’s figure of US$4.1 billion.

Notably, remittance flowing to the real estate market dropped to around 7% compared to around 23% last year. Most remittance was put into operation of family-run businesses.

The remittance volume exchanged into Vietnam dong accounted for 30% of the total, up from levels in previous years at 15-17%. Low deposit rates have prompted people to sell their foreign currencies to get dong.

Most remittance was sent from overseas Vietnamese for their families while that from laborers accounted for around 22%.