What is the "cure" to stabilize the gold market?

Queue in person to queue online

Recently, with the goal of stabilizing the gold market, the State Bank of Vietnam (SBV) has implemented a plan to sell SJC gold bars directly to 04 State Commercial Banks (SCBs) and Saigon Jewelry Company Limited (SJC).

However, in the first week of implementation, there was a situation where people rushed to buy gold, some even lined up to buy gold from 5am. According to information from the State Bank, at many gold selling points, there were people who hired people to line up to buy gold with the aim of pushing up prices, profiting from the difference, causing market instability and damage to the economy.

To limit the above situation, since June 17, 4 state-owned commercial banks, Vietcombank, BIDV, Agribank, Vietinbank, have switched to selling gold online. By June 20, Saigon Jewelry Company (SJC) also stopped direct buying and selling, switching to selling gold online to people.

However, many people still report the difficulty of buying gold on banking apps. Instead of queuing to buy gold directly, people have now switched to queuing online. Mr. Nam (Cau Giay District, Hanoi) shared that buying gold is more difficult than before due to the large number of people placing orders.

“Since launching online gold sales, I ordered one bar and then couldn’t order again. At exactly 9am, when I went to the gold sales website, the network wouldn’t load. When it loaded, the page said it would be scheduled for tomorrow.”

According to Nguoi Dua Tin , when accessing the bank's gold trading websites, a similar situation is encountered when the bank makes an appointment to return on the next working day because the branch has received enough quantity for the day.

Agribank's online gold sales page.

According to expert Truong Vi Tuan, banks implementing online gold sales helps gold buyers have a fairer chance to access the market. Instead of having to jostle each other to get a number, people can use technological measures through banking apps to buy gold bars.

At the same time, it solves the problem of queuing because when buying gold online, customers must verify their identity and have proof of money transfer because all buyer information is stored in the bank's app. In addition, customers can pay effectively through banking apps, reducing waiting time in line.

However, Mr. Tuan also pointed out that buying gold online is still relatively difficult for people when websites are always overloaded or have security errors, and cannot log in. In addition, if they register to buy gold, investors still have to go to the branch to get the gold, causing inconvenience when traveling.

Associate Professor Dr. Ngo Tri Long, former Director of the Institute for Price Market Research (Ministry of Finance) also said that selling gold at the current price regulated by the State Bank is reasonable, helping to reduce the difference between domestic and world gold prices.

However, Mr. Long said that this is only a temporary solution, because if the above measure is prolonged, it will cause consequences, specifically the situation of "goldenization". When people only focus on buying gold, gold will remain in the hands of the people. While the main purpose is to mobilize capital from the people to serve and restore production and business.

The State Bank should expand the gold selling channel.

Proposing a long-term solution to stabilize the gold market, Mr. Long said that the management agency needs to adjust Decree 24 because this Decree is currently revealing shortcomings, many regulations are not in accordance with market rules and international practices.

Mr. Truong Vi Tuan said that the State Bank needs to increase the supply of gold to the market to meet people's demand. The State Bank needs to be transparent about the volume of gold bar supply during the recent sale period, update reports from SJC as well as 4 State-owned commercial banks so that the market knows whether the gold purchasing power as well as the State Bank's gold supply is enough to meet buyers' demand or not.

Besides, the most important thing now is that banks need to thoroughly solve technology problems, quickly overcome the phenomenon of not being able to buy gold, and hanging websites.

Associate Professor, Dr. Ngo Tri Long, former Director of the Institute for Price Market Research (Ministry of Finance).

“The State Bank should expand the sales channel. In addition to SJC and 4 state-owned commercial banks, businesses with licenses to buy and sell gold bars should be allowed to participate in stabilizing the market. On condition that businesses must ensure the volume of buying and selling during the day and verify the identity of the customers buying.

At the same time, the price of gold bars should be adjusted according to the world gold price. If the world gold price drops sharply but the price of gold bars remains unchanged, the stabilization goal may not be achieved," Mr. Tuan shared.

Sharing the same opinion with Mr. Tuan, Associate Professor Dr. Nguyen Huu Huan, Lecturer at Ho Chi Minh City University of Economics, said that the most necessary solution to stabilize the gold market at this time is for the State Bank to meet the supply for the people.

At the same time, the State Bank should consider restricting people from owning pure gold. Because people do not trade, produce or craft gold or jewelry. Long-term ownership of pure gold by people can cause the economy to become gold-ized. Therefore, there should be regulations to restrict people from owning gold, instead using gold credits.

On June 21, the State Bank of Vietnam held a meeting with gold bar trading organizations to thoroughly grasp the direction of the Government and the Prime Minister on market management, discuss measures as well as propose and recommend to continue to implement the goal of stabilizing the gold market.

At the meeting, there were opinions that the recent market developments showed signs of hiring queues, market manipulation, and market manipulation. Units participating in the sale of SJC gold bars all affirmed that they will continue to improve processes and technology to facilitate people who want to buy real gold, eliminating speculation. However, it is also necessary to communicate so that people are clearly aware, avoiding psychological effects when buying gold.

Governor Nguyen Thi Hong requested that units fully absorb the valid comments from gold trading enterprises and banks to propose amendments to Decree 24. The State Bank affirmed that it has enough determination, resources, and tools to implement appropriate short-term and long-term solutions for the gold market to develop stably according to the principle of a market under state management .

Source: https://www.nguoiduatin.vn/dieu-chinh-nghi-dinh-24-giai-phap-lau-dai-de-binh-on-gia-vang-a669769.html