The State Bank of Vietnam has suspended the recently restarted gold auctions and may introduce new policies on June 3 to stabilize the gold price

A statement on the website of the Vietnamese regulatory authorities shows that the State Bank of Vietnam (SBV), also known as the Vietnamese central bank, has suspended gold auctions based on the instructions of the country's Prime Minister. The SBV will take other measures to stabilize the market, with the new measures expected to be implemented as early as next Monday, June 3. As for the specifics of the new measures, there is currently no detailed information available.

On April 19, media reports indicated that the SBV announced the resumption of gold bar auctions after a ten-year hiatus, aiming to increase the supply of gold, a precious metal, at a time when gold prices hit historic highs, in order to stabilize the local market. It is worth mentioning that prior to this year's auction, the SBV's most recent auction dated back to December 2013.

Due to tensions in the Middle East and the Russia-Ukraine conflict, gold has reached new highs this year, elevating its status as a safe-haven asset. However, the surge in gold prices has not dampened Vietnam's demand for gold, leading to local gold prices being up to 15 million Vietnamese dong (approximately $590) higher than international gold prices at one point.

Prime Minister Pham Minh Chinh has been urging the country's central bank to take measures to stabilize the domestic market. Pham Minh Chinh previously stated that in order to prevent unfavorable developments, the price gap between local and international gold in Vietnam must be narrowed, and he requested the SBV to strengthen measures to stabilize the market.

In a statement in April, the SBV announced that it would auction 16,800 taels of gold on April 22, with a maximum purchase limit of 2,000 taels for each of the 15 eligible organizations, including commercial banks and gold jewelry companies. In the auction on May 23, the SBV supplied 13,400 taels of gold at a price of 88.7 million Vietnamese dong, with seven bidders winning.

Since April 19, the SBV has conducted nine gold bar auctions, with six successful auctions releasing a total of 48,500 taels of gold. However, the remaining auctions were canceled due to a lack of participants' deposits and bids. All auctions involved gold bars of the SJC brand.

SJC gold bars are produced by the renowned Saigon Jewelry Company Limited (SJC) in Vietnam. This company is well-regarded in Vietnam for producing high-quality gold products. SJC gold bars are trusted for their purity and reliability, commonly used for investment, savings, and hedging against inflation and currency fluctuations.

Economists believe that the SBV's gold bar auctions can stabilize the local gold market in the short term. However, the ultimate impact will depend on how much gold the SBV can sell.

The SBV also announced plans to inspect the gold trading activities of commercial banks such as TPBank and Eximbank, as well as gold traders like SJC, Doji, Phu Nhuan, and Bao Tin Minh Chau. The focus will be on reviewing transactions from January 1, 2020, to May 15, 2024, and may extend the investigation period beyond this timeframe if necessary The analysis article "97 East Asian Currency Crisis, is Gold the Most Affected?" on the Wall Street See News website pointed out that under currency pressure, some countries may stabilize their exchange rates by selling gold. The Korean won, which has depreciated by over 7% this year, also relied on the power of gold during the Asian financial crisis at that time