Gold slightly drops; dollar climbs

The price of gold in Vietnam fell by VND20,000 a tael (1.2 ounces) over the previous day on October 5 as global prices declined due to a stronger dollar.

Generally, gold was bought at VND31.55 million and sold at VND31.6 million. Yesterday, the precious metal peaked an all-time high of VND31.62 million a tael.

In Hanoi, SJC-brand gold of the Saigon Jewelry Co, the country’s biggest gold shop, was purchased at VND31.53 and sold at VND31.6 million as of 9 am local time.

Meanwhile, Sacombank Jewelry Co. bought gold at VND31.55 million and sold at VND31.6 million.

The gap between domestic and global prices gradually expanded. Local gold prices were VND300,000 a tael higher than global prices.

The US dollar exchange rate against the Vietnamese dong continued climbing on black market. Dollars were bought at VND19,630, and sold at VND19,660, an increase of VND10 per dollar over the previous day.

Internationally, bullion dropped as dollar strengthened, curbing the demand for the metal as an alternative asset.

Gold for immediate delivery lost US$3.6 an ounce, or 0.3 percent, to $1,316 an ounce in New York.

In Asia, the metal traded below $1,215 an ounce as of 9:25 am Vietnamese time.

SPDR Gold Trust, the largest exchange-traded fund backed by bullion, dumped 0.4 metric tons, reducing its holdings to 1,301.9 metric tons. Meanwhile, holdings at 10 exchange-traded funds monitored by Bloomberg also sank by 0.7 metric tons yesterday to 2,094.3 metric tons.

The US Dollar Index, which tracks the greenback’s strength against a basket of six major currencies, gained after a panel appointed by Swiss government announced that UBS AG and Credit Suisse Group AG should almost double the capital required under Basel III rules.

In addition, the Ireland’s central bank said the country’s economy would probably falter this year. Greece also forecasted that economic growth would shrink 4 percent this year and 2.6 percent next year.

Meanwhile, a report by the US National Association of Realtors showed pending sales of existing homes climbed more than forecast in August. Signed contracts rose by 4.3 percent after a 4.5 percent increase in July, topping a four-month high.

The euro exchange rate fell to $1.37 a euro this morning from $1.38 the previous day.

Crude oil futures for November delivery dropped $0.11 a barrel to close at $81.47 a barrel on New York Mercantile Exchange.

This morning, crude oil hovered around $81.4 a barrel.

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