CaliToday (04/9/2025): Vietnam's domestic gold market is experiencing extreme volatility as the price for the state-monopolized SJC gold brand surged to a historic peak, nearing the unprecedented threshold of 134 million Vietnamese Dong (VND) per tael. This dramatic spike comes in stark defiance of global trends, where international gold prices have been on a downward trajectory, creating a record-breaking price gap and signaling significant risks for local investors.
This afternoon, major retailers in Hanoi and Ho Chi Minh City listed SJC gold bars at approximately 133.8 million VND per tael for sellers. A "tael," a traditional unit of weight used in the region, is equivalent to 37.5 grams or about 1.2 troy ounces. At the current exchange rate, this places the domestic price at over $5,350 per tael.
In sharp contrast, the spot price for gold on the international market has been weakening, trading at around $2,750 per tael ($2,290 per troy ounce). This has opened up an astonishing premium of more than $2,600 between the domestic SJC price and the world price for the same amount of gold, a disparity that analysts are calling unsustainable and perilous.
This significant market anomaly is largely attributed to Vietnam's stringent market regulations. The government exercises tight control over the gold market, with the Saigon Jewelry Company (SJC) being the sole state-recognized brand for gold bullion production and strict quotas limiting official gold imports. This policy effectively insulates the domestic market from global supply and pricing dynamics, creating a localized market driven by domestic demand, speculation, and a perceived scarcity of supply.
Market experts are issuing strong warnings to investors about the inherent risks associated with this widening gap. The exorbitant premium is not based on the intrinsic value of the gold itself but on local market conditions that could change abruptly.
"Investors in Vietnam are not just buying gold; they are paying a massive premium for a government-regulated product in a supply-constrained market," commented a financial analyst based in Ho Chi Minh City. "The primary risk is a sudden change in government policy. If the State Bank decides to increase import quotas or abolish the SJC monopoly, the domestic price could plummet overnight to align with global rates, leading to catastrophic losses for those who bought at the peak."
The current situation places investors in a precarious position, caught between the cultural affinity for gold as a safe-haven asset and the clear financial risks of participating in a market bubble. Regulators are now under increasing pressure to find a solution to stabilize the market and protect investors from the potentially severe consequences of the ever-growing disconnect between domestic and international gold prices.
