Vietnam has extended until the end of the year the period in which traders may import gold to try to bring local prices back into line with the global market, according to the Vietnam Gold Traders Association.
About 10 traders may import the metal from Nov. 24 to Dec. 31, with allowances of 300 kilograms to 1,000 kilograms, Vice Chairman Nguyen Thanh Truc said Thursday. Previously, a central- bank directive permitted imports only for the 14 days to Nov. 23, according to a Nov. 9 statement from the State Bank of Vietnam.
Local prices have climbed to more than international levels as three devaluations of the dong in the past year, slumping stock prices and faster inflation boosted demand. The government has suspended gold imports in the past to help support the dong, which investors sell to buy dollars and gold. Vietnam consumes more gold per head than India, the biggest overall user.
"Although local prices have eased" after imports were allowed, they are still sometimes higher than world prices, Truc said by phone. One tael is about 1.2 ounces.
Local gold traded at VND35.8 million per tael in Hanoi Thursday, according to a phone-information service run by Vietnam Posts and Telecommunications. That compares with Thursday's global spot price of $1,372 an ounce, which is equivalent to about VND32.1 million per tael, according to Bloomberg calculations using the official exchange rate for the Vietnamese currency.
Central bank policy
The central-bank decision on Nov. 9 to allow imports for 14 days was meant to "continue stabilizing" the local gold market, according to that day's statement. Central bank Governor Nguyen Van Giau wasn't immediately available for comment Thursday on the extended import period.
Global gold prices surged to a record this month as weaker currencies and Europe's sovereign-debt concerns boosted demand. Immediate-delivery gold peaked at $1,424.60 an ounce on Nov. 9, while Vietnam's prices climbed to a record VND38.2 million per tael the same day.
Rising domestic gold prices contributed to inflation, Prime Minister Nguyen Tan Dung told delegates at the National Assembly in Hanoi Wednesday. Inflation accelerated in November to 11.09 percent, the highest rate since March 2009.
The dong traded at 19,495 per dollar Thursday, according to Bloomberg data, and has weakened 5.5 percent this year.
Vietnam imported 6.86 tons of gold in the first nine months of 2010, the Vietnam News newspaper reported yesterday, citing data from the State Bank of Vietnam.