Vietnam dong weakens as dollar demand rises for gold imports

TN News

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The Vietnamese dong weakened on speculation companies bought dollars to import gold after domestic prices for the metal surpassed global prices. Bonds advanced.

The first imports of gold under new government quotas are expected to start arriving on Friday August 11, Vietnam News reported on Thursday, citing importers. Companies were given permission to import up to five metric tons of gold, the nation's central bank said on Aug. 9 after local prices surged to a record.

"Dollars have been mobilized to import gold under the new central bank regulation," said Nguyen Duy Phong, a Ho Chi Minh City-based analyst at ACB Securities Inc.

The dong fell 0.1 percent to 20,812 per dollar as of 3:39 p.m. Thursday in Hanoi, according to data compiled by Bloomberg. The currency has declined 1.1 percent this week.

The State Bank of Vietnam set the dong-dollar reference rate at 20,618 Thursday, unchanged from yesterday, according to its website. The dong is allowed to trade up to 1 percent on either side of the fixing.

The yield on Vietnam's five-year bonds fell two basis points to 12.55 percent, according to a daily fixing price from banks compiled by Bloomberg. A basis point is 0.01 percentage point.

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