Vietnam Jewelry Gold Demand Hits Record as Bullion Buying Slumps; PM Urges Less Hoarding

Vietnam posted a record for gold jewelry demand in the first quarter, even as demand for gold bars and coins fell sharply, highlighting a split between consumer buying and investment flows. The government says it will continue to recognize citizens’ right to hold gold as an asset, while seeking to curb hoarding and speculation and steer money toward the real economy.

Vietnamese media on April 30, citing the World Gold Council’s first-quarter report, said Vietnam’s gold jewelry demand totaled $472 million, the highest on record. That was up 28% from the fourth quarter of last year, bucking a broader cooling in consumption across many markets. Analysts said tight supplies of gold bars also pushed some demand toward alternatives such as pure-gold rings.

Globally, first-quarter gold jewelry demand fell 23% from a year earlier to 300 tons. The decline was widespread, led by drops of 32% in China, 19% in India and 23% in the Middle East.

Within ASEAN, the pullback in investment demand was especially notable. Vietnam’s first-quarter demand for gold bars and coins fell 24% from a year earlier to 9 tons, diverging from the global trend in which retail demand for bars and coins rose 42% to 474 tons.

The government is moving to tighten institutional oversight of the gold market. At a meeting with the State Bank of Vietnam on April 29, Prime Minister Le Minh Hung told the banking sector to “develop a roadmap suited to reality and build mechanisms to effectively control the gold market.”

While affirming that people have the right to hold gold as an asset, he said, “We must minimize gold hoarding and speculation.” He added that as macroeconomic fundamentals stabilize and the legal framework becomes more transparent, funds held by households and businesses could shift naturally into production and business activity or bank deposits, helping mobilize resources for growth.

Le also laid out broader principles for economic management. “Macroeconomic stability is like the foundation of a house,” he said, adding that before adding floors, remodeling or rebuilding, “you must first strengthen that foundation.” He said exchange rates, interest rates and credit policy should all be managed within the overarching goals of maintaining stability, controlling inflation and ensuring the safety of the financial system.

In late January, the government asked the central bank to quickly complete its review of documents related to a proposal to establish a national gold exchange or gold trading platform. The push to overhaul the gold market is tied to a broader effort to secure funding for growth. The National Assembly has set targets of average annual growth of at least 10% through 2030 and entry into the world’s top 30 economies by GDP. To meet those goals, the total capital required is projected to rise by about 1.7 to 2 times compared with the previous term. With the state budget expected to cover only 20% to 22%, mobilizing private funds is seen as critical.

Against that backdrop, the prime minister also outlined credit-policy directions aimed at redirecting money concentrated in gold into the real economy. He called for flexible management of credit growth depending on conditions, while guiding funds toward production and business. He also urged a review of rules to allow above-limit lending for strategic and nationally important projects, tighter supervision of credit to potentially risky sectors, and stronger support for social housing and industrial park development.

Kim Hye In

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