The Vietnamese currency has been repeatedly devalued in the past years, the latest devaluation being of about 7 percent in February. Officials have tried to steady the dong by clamping down on the use of dollars and gold.
This has produced a distortion between the international and the local gold price, and totally disrupted the Gold and dollar markets.
In an attempt to “stabilize” the market and narrow the price spread between the international and the local price of Gold, the State Bank of Vietnam has allowed Vietnamese companies to import a total of five metric tons of gold. The central bank also said it plans to give further licenses to import an additional five tons of gold to meet domestic demand.
In Vietnam, gold rose to VND45.75 million ($2,200) per tael in Hanoi Tuesday morning, an all-time high. One tael is about 1.2 ounces.
