Domestic gold prices continued to climb during the morning session on May 7, driven by global market developments and investor sentiment, according to major gold retailers. Leading traders such as SJC, PNJ, and DOJI quoted buying prices at VND 4.828 million per tael and selling prices at VND 4.908 million per tael, marking an increase of VND 20,000 from the previous day.
Analysts attribute the rally in domestic prices to rising global gold demand, particularly from China — the world’s largest consumer — following the conclusion of its Labour Day holiday. In addition, ongoing purchases by central banks seeking to diversify away from the US dollar have added upward pressure on international prices.
Despite generally tracking global trends, domestic gold prices continue to trade at a significant premium. When adjusted for the official exchange rate, global gold prices equate to approximately VND 4.252 million per tael — VND 480,000 to VND 640,000 lower than Vietnamese retail levels.
Price Disparity Raises Smuggling, Policy Concerns
The widening price gap has raised alarms about potential cross-border smuggling aimed at exploiting the arbitrage opportunity. Assoc. Prof. Dr. Cao Dinh Kien of the Foreign Trade University warned that illicit gold inflows could disrupt the foreign exchange market, exert pressure on the VND/USD rate, undermine the effectiveness of monetary policy, and result in lost tax revenue.
“The smuggling issue poses a real threat to macroeconomic stability, especially in terms of inflation control and exchange rate management,” Kien told VIR.
A report submitted by the Governor of the State Bank of Vietnam (SBV) to the National Assembly on May 5 highlighted that volatility in the domestic gold market has intensified since early April, driven by record-setting global prices.
While the gold surge has not yet impacted monetary policy execution, the SBV warned that the domestic market remains sensitive to investor sentiment and expectations — factors that could pose risks to monetary and foreign exchange stability.
SJC Gold Bars Trade at Steep Premium
As of midday on May 6, the price gap between SJC-branded gold bars and international gold — after conversion — reached approximately VND 578,000 per tael, or 13.62 percent. The SBV explained that the steep premium is largely fueled by sentiment and speculative demand.
“The SBV recognizes that the gold market has yet to reach a state of sustainable stability and still presents potential risks,” said SBV Governor Nguyen Thi Hong. “Long-term solutions require more than just administrative measures — coordination among ministries, local authorities, and related sectors is essential.”
International Developments Apply Downward Pressure
Globally, spot gold prices dropped sharply by $68 to $3,365 per ounce on the morning of May 7. The decline followed announcements that U.S. and Chinese officials will meet in Switzerland on May 10–11 to discuss economic and trade issues, a move seen as reducing geopolitical tensions and weakening demand for safe-haven assets.
Despite President Donald Trump’s recent comments about imposing new tariffs on pharmaceutical imports, easing concerns around U.S.-China trade relations contributed to the price correction. Persistent tensions between India and Pakistan, and ongoing conflicts in the Middle East, are still factors — but experts say much of this risk has already been priced into the market.
Analysts Urge Caution Amid Price Swings
Gold market analyst Tran Duy Phuong believes gold could rise to $3,700 per ounce in the near term, but sees this scenario as unlikely. “Geopolitical concerns play a role, but decisions on tariffs by major economies have a more significant impact on gold prices,” he said.
Nguyen Quang Huy, Dean of the Faculty of Finance and Banking at Nguyen Trai University, emphasized that while gold remains a reliable long-term store of value, it is best suited for investors with a clear strategy.
“Prices don’t rise forever. Gold is prone to sharp corrections when sentiment shifts, or when authorities intervene to stabilize the market,” Huy cautioned. “Investors should avoid being swayed by emotions or herd behavior and prepare for the possibility of sudden reversals.”
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