The local gold price has dropped by VND610,000 ($28.8) a tael following world trend after Federal Reserve (Fed) chairman Ben Bernanke said there would be no immediate quantitative easing on Thursday.

For illustration purposes only

As of 9:30 am, gold bullions produced by Saigon Jewelry Co, the biggest Vietnamese gold refiner and trader, were quoted at VND41.5 million a tael and VND41.8 million a tael for bid and ask, respectively.

Meanwhile, the bid and ask price of SJC gold bullions in Hanoi were also trading at VND41.5 million a tael and VND41.82 million a tael, respectively.

Rong Vang Thang Long (Thang Long Golden Dragon) refined by the Hanoi-based Bao Tin Minh Chau Co were quoted at VND40.55 million a tael and VND40.85 million for bid and ask, respectively.

At the same time, spot gold was quoted by Kitco.com at $1,567.40 an ounce, and is still on a downward trend.

With the current exchange rate, plus additional fees and taxes, the local gold price was VND2.1 million a tael costlier than its world counterpart.

The precious metal has fallen by VND300,000 a tael compared to late last week.

Comex gold futures prices Thursday dropped below the psychological support at $1,600 an ounce.

August gold last traded down $43.20 at $1,590.8 an ounce, and spot gold then was last quoted down $30.20 an ounce at $1,590.

They both careened downward following Fed chairman Ben Bernanke's speech to the Joint Economic Committee of the U.S. Congress.

Bernanke said the US is facing economic headwinds, especially due to the European Union debt crisis, but offered no specifics on any fresh monetary stimulus package to promote more economic growth.

The speech disappointed gold market bulls who wanted immediate gratification on economic stimulus.

The US dollar index has traded lower again on more profit-taking from recent gains. The dollar index bulls still have the overall near-term technical advantage.

Some local banks have lowered the price of the US dollar below the ceiling rate by VND11 per dollar.

The prices of the greenback range from VND21,025-21,036 a dollar and from VND20,935 to 20,950 a dollar for bid and ask, respectively.

The average interbank rate Friday remained at VND20,828 a dollar with the ceiling rate of VND21,036 a dollar, unchanged for 24 weeks in a row.

State Bank of Vietnam governor Nguyen Van Binh late Thursday told the National Assembly that the central bank had bought $9 billion for the national forex reserves so far this year after pumping VND180 trillion ($863.3 million) into the market.

As of March 2012, SBV had used around VND130 trillion to buy $6.23 billion worth of foreign currencies from banking systems for the national reserve.

The central bank has also sold some $100 million for the banking system, Binh said.

Vietnam’s foreign exchange reserves as of mid-March jumped 25-27 percent over the end of last year, said the central bank governor in a press conference early last month. 

Governor Binh added that the forex reserve surged 50 percent in 2011 over 2010.

Earlier this year, Binh said the central bank will not devalue the Vietnam dong by more than 3 percent in 2012.

Source: tuoitrenews