World gold price drops nearly 1.9%
Last week, international gold prices turned down after two consecutive weeks of increase, despite escalating tensions in the Middle East. At the end of the week, spot gold prices reached 3,368 USD/ounce, down 1.89% compared to the end of last week. Gold futures for August delivery on the Comex floor also fell to 3,384 USD/ounce.
Profit-taking pressure increased last week as investors had to make up for losses in other markets amid escalating tensions in the Middle East with repeated attacks between Israel and Iran. Israeli warplanes continued to target Iranian military targets, especially missile component and engine manufacturing sites. Meanwhile, Iran continued to launch missiles towards Israel. Market sentiment became more cautious due to the risk that the US could directly intervene militarily in Iran.
Although US President Donald Trump previously said he would spend two weeks on diplomacy before deciding to attack Iran, an airstrike targeting Iran's nuclear facilities took place a few hours ago. According to CNN, US President Donald Trump said the US had completed attacks on three nuclear sites in Iran, including Fordow, Natanz and Esfahan. After attacking the three sites, all US aircraft are now outside Iranian airspace. Iran confirmed that the nuclear facilities were attacked, but did not specify the damage.
On his social networking site, the US president also said that any act of revenge by Iran against the US will be met with greater force than what has happened recently.
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| World gold price adjusted after surpassing 3,450 USD/ounce at the beginning of the week |
During the week of June 16-20, the market focus was also on the monetary policy meeting of the US Federal Reserve (Fed). Although the Fed kept interest rates unchanged and signaled two cuts in 2025, Chairman Jerome Powell warned that inflation could continue to rise due to the impact of President Trump's new tariff policy.
In response to the Fed’s decision not to cut interest rates, Mr. Trump once again attacked Chairman Powell and mentioned the possibility of choosing a successor soon in the context of the US economy showing many signs of slowing down. “Maybe, just maybe, I will reconsider firing him. But his term is almost over anyway,” the US President posted on Truth Social.
Domestic gold continues to increase slightly in the opposite direction.
Despite the downward trend of world prices, domestic SJC gold bars increased slightly by VND200,000/tael during the week. At Saigon Jewelry Company (SJC), the gold price closed last week at VND117.7 - 119.7 million/tael (buy - sell). Other major gold trading companies such as DOJI, Bao Tin Minh Chau and Mi Hong... all listed similar transaction prices. Plain round gold rings at Bao Tin Minh Chau were traded at VND114.5 - 117.5 million/tael.
Recently, the Vietnam Gold Business Association has sent a document to comment on the Draft Amendment and Supplement to Decree 24 on Gold Market Management (Decree 24). Notably, the Association has proposed not to add credit institutions, especially commercial banks, to participate in the production and trading of gold bars because commercial banks do not have the function and task of producing gold. According to the Association, if commercial banks are allowed to participate in the production and trading of gold bars, commercial banks will be forced to use a large amount of capital to invest in factories, machinery, training workers, and investing in areas that are not within their main functions and tasks of providing credit and supporting capital for production and trading enterprises to achieve economic growth targets.
In addition, the Vietnam Gold Business Association commented on the conditions for being granted a license to produce gold bars. The association believes that the regulation on charter capital of 1,000 billion VND or more is too strict, only 1 to 3 gold production and trading enterprises can meet this condition. The association recommends that a charter capital of 500 billion VND or more is appropriate. In addition, it is necessary to focus on the production capacity of enterprises, business efficiency, business reputation, brand in the market, design and quality of gold bars; and compliance with state regulations related to gold trading.
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| Price of SJC gold bars at Saigon Jewelry Company |
Meanwhile, the USD/VND exchange rate remains quite tense as the selling rates at banks have been anchored at the ceiling from the end of the previous week to all sessions this week.
The central exchange rate announced by the State Bank on June 20 was 25,031 VND/USD, a sharp increase of 56 VND compared to the end of last week. The ceiling exchange rate according to regulations is up to 26,282 VND/USD. At Vietcombank, the listed exchange rate until the end of the week was 25,922 - 26,282 VND/USD (buy - sell), an increase of 59 VND/USD. In the free market, the selling price of USD, although slightly adjusted down at the end of the week, was still close to the mark of 26,400 VND/USD.
The US dollar also posted a weekly gain, but only slightly. The US Dollar Index (DXY) closed at 98.6 points on Friday as investors continued to seek refuge in the greenback amid rising political tensions and global trade uncertainty.
Next week, geopolitical developments in the Middle East will continue to impact investor sentiment in financial markets, which are sensitive to volatility. Investors will also closely monitor Fed Chairman Jerome Powell's testimony before Congress, along with a series of important economic data such as the PCE report - the Fed's preferred inflation measure. Preliminary PMIs in the US, Eurozone, Japan, China and India will also be released, providing signals on global growth prospects. US-China trade negotiations are also information that may appear and become the focus of investor sentiment.
Source: https://baodautu.vn/vang-tam-roi-moc-3400-usdounce-tuan-moi-kho-doan-dinh-giua-loat-bien-dong-dia-chinh-tri-d310487.html
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