HANOI, Nov 11 (Reuters) - Vietnam's central bank on Wednesday lifted a 1-1/2-year-old ban on gold imports in a bid to stabilise the market after a recent sharp rise in prices helped to push the country's dong currency to a record low. 'The State Bank of Vietnam will allow gold imports with a volume sufficient to intervene in the market in order to stabilise the market, combat speculation and prevent an impact on the interests of the people,' the central bank said in a statement.
For factbox, 'Asian central banks take divergent views on gold,' click:
The ban on gold imports since May 2008 led to a gap between domestic and international prices, but in recent days, traders say that spread has triggered a surge in demand for dollars.
On Tuesday the dong broke through the level of 19,000 to the dollar, and sank further on Wednesday to 19,800, before rebounding to around 19,000.
Gold leapt to around 29 million dong per tael on Wednesday, or $1,261 per troy ounce at an exchange rate of 19,000 dong per dollar. Later it came back down to around 27.5 million dong. Internationally, gold stood at around $1,115 an ounce. The central bank blamed domestic speculators for pushing the gold price above world levels.
Offshore dealers covering Vietnam said gold bars had been smuggled in from neighbouring countries to meet growing demand.
'The thing is, people are cautious,' a dealer in Singapore said. 'The domestic price is so high because they haven't imported gold for a long time. Basically, there's a shortage of physical gold.'
(Reporting by John Ruwitch and Ho Binh Minh in HANOI and Lewa Pardomuan in SINGAPORE; Editing by Clarence Fernandez)
((john.ruwitch@thomsonreuters.com; +84 4 3825 9623; Reuters Messaging: john.ruwitch.reuters.com@reuters.net)) Keywords: VIETNAM GOLD/ (If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
For factbox, 'Asian central banks take divergent views on gold,' click:
The ban on gold imports since May 2008 led to a gap between domestic and international prices, but in recent days, traders say that spread has triggered a surge in demand for dollars.
On Tuesday the dong broke through the level of 19,000 to the dollar, and sank further on Wednesday to 19,800, before rebounding to around 19,000.
Gold leapt to around 29 million dong per tael on Wednesday, or $1,261 per troy ounce at an exchange rate of 19,000 dong per dollar. Later it came back down to around 27.5 million dong. Internationally, gold stood at around $1,115 an ounce. The central bank blamed domestic speculators for pushing the gold price above world levels.
Offshore dealers covering Vietnam said gold bars had been smuggled in from neighbouring countries to meet growing demand.
'The thing is, people are cautious,' a dealer in Singapore said. 'The domestic price is so high because they haven't imported gold for a long time. Basically, there's a shortage of physical gold.'
(Reporting by John Ruwitch and Ho Binh Minh in HANOI and Lewa Pardomuan in SINGAPORE; Editing by Clarence Fernandez)
((john.ruwitch@thomsonreuters.com; +84 4 3825 9623; Reuters Messaging: john.ruwitch.reuters.com@reuters.net)) Keywords: VIETNAM GOLD/ (If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.