Gold Price Fluctuation in Vietnam in 2012
ASSIGMENT OUTLINE
GOLD PRICE FLUCTUATION IN VIETNAM 2012 1. INTRODUCTION
Gold appeared a long time ago and became a precious metal. It’s a very precious metal with various values and plays an important role in the world’s economy today because it is used in many fields of life such as material for making jewelry, decorator, … Besides, gold has been considered as a world currency that is irreplaceable by any other units of account. Therefore, both individuals and businessmen have a high demand for gold, which impulses the development of the gold market in all countries.
In Vietnam, gold is used not only as a reserve asset but also as a mean of payment in transactions. Long-time trend of gold price is upward but in short-time period, the price of gold fluctuates very complicatedly. From 2001, gold’s price increases continuously. Especially, from April 2006, the price gold in Vietnam rised dramatically (from 0.98 million to 1.5 million per unit). Although its stability after that with 1.3 million, its price all over the world and in Vietnam increases sharply, which breaks the record in 1980. Until now, specially in 2012, the price of gold is really “hot”. It sometimes go up to 47.4 million per unit. Comparing December 2011 and December 2001, the gold’s price rises about 8.6 times – it can be called “the century of gold”. After rising dramatically and continuously in a long time, the price had the trend of reducing (from October 2011 to July 2012). But it cannot be keep any longer as from the end of August 2012, it rises sharply. The enormous rise in gold price causes an unhealthy psychological effect on people: when the price goes up, they try to buy as much as they can, but when it falls, people tend to sell gold as quickly as possible. This is one of the reason for the expectation of increasing price level of gold, beside the main factor brought by the fluctuations in global gold prices. The instability of gold price seems to make Vietnam’s economy worsen.
GOLD PRICE FLUCTUATION IN VIETNAM 2012 1. INTRODUCTION
Gold appeared a long time ago and became a precious metal. It’s a very precious metal with various values and plays an important role in the world’s economy today because it is used in many fields of life such as material for making jewelry, decorator, … Besides, gold has been considered as a world currency that is irreplaceable by any other units of account. Therefore, both individuals and businessmen have a high demand for gold, which impulses the development of the gold market in all countries.
In Vietnam, gold is used not only as a reserve asset but also as a mean of payment in transactions. Long-time trend of gold price is upward but in short-time period, the price of gold fluctuates very complicatedly. From 2001, gold’s price increases continuously. Especially, from April 2006, the price gold in Vietnam rised dramatically (from 0.98 million to 1.5 million per unit). Although its stability after that with 1.3 million, its price all over the world and in Vietnam increases sharply, which breaks the record in 1980. Until now, specially in 2012, the price of gold is really “hot”. It sometimes go up to 47.4 million per unit. Comparing December 2011 and December 2001, the gold’s price rises about 8.6 times – it can be called “the century of gold”. After rising dramatically and continuously in a long time, the price had the trend of reducing (from October 2011 to July 2012). But it cannot be keep any longer as from the end of August 2012, it rises sharply. The enormous rise in gold price causes an unhealthy psychological effect on people: when the price goes up, they try to buy as much as they can, but when it falls, people tend to sell gold as quickly as possible. This is one of the reason for the expectation of increasing price level of gold, beside the main factor brought by the fluctuations in global gold prices. The instability of gold price seems to make Vietnam’s economy worsen.
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