Gold Essay

523 WordsMar 16, 20083 Pages
In the year 2006, world gold prices fluctuated with great amplitude. In the beginning of 2006, gold was sold at 530 USD/oz, but the prices had reached 750 USD/oz in 5/2006, the highest in the past 26 years. The average price in 2006 was 602.,35 USD/oz. Imports fulfilled 95 per cent of Viet Nam’s gold demand, so the domestic market was driven by the world market. However, from the beginning of the year to 3/2006 domestic prices were still lower than world prices, due to a weak demand among the general population. Beginning from 4/2006, domestic gold prices were much higher than world prices, with the highest being over 1.3 million VND. In 5/2006, the prices reached its peak at over 1.5 million VND/one tenth of a tael only to drop lower than 1.2 million VND ( world prices fell to 570USD/oz) But after the end of 10/2006, domestic prices fell lower than world gold prices, even reached 200,000 VND/tael. World Gold committee (WGC) has just announced a report, showing the gold demand in the first 6 months of year 2007 has risen by 11% in comparison with the same period in 2006. In the mean time, jewelry demand of the second quarter has risen with a rate 37% faster than that of 2006, esp. in those countries of India, China and Turkey. Gold retail demand in the second quarter of 2007 rose by 51% in quantity, which are is 132.9 tons and 60% in value in USD. Gold demand of India in the 2nd quarter of 2007 has reached 317 tons, equals 50% the total gold production of the world. However, the total gold supply for 2007 market was 4% less than that in 2006. That means gold demand of the market is still greater than gold supply, so the rise in gold prices is inevitable. Together with the fall in exchange rate, gold is devaluing dramatically. In only 2 days, gold prices in the world market have decreased by more than 10USD/ounce, which is 725.70USD/ounce in 4/10. In

More about Gold Essay

Open Document