Vietnam's average gold price closed at 41.65 million Vietnamese dong (VND) (1,997 U.S. dollars) a tael (equivalent to 1.2 ounces) on Friday, an increase of 50,000 VND (2. 3 U.S. dollars) over the previous trading day, and almost the same as last Friday's closing session.

In Vietnamese capital Hanoi, the national SJC-branded gold was traded with buying price at 41.43 million VND (1,987 U.S. dollars) a tael on Friday and selling price at 41.65 million VND (1,997 U.S. dollars) a tael, an increase of 50,000 VND (2.3 U.S. dollar) against the previous day.

Saigon Jewelry Joint-Stock Company in southern Ho Chi Minh City quoted buying price at the same, and selling price at 20,000 VND ( 0.9 U.S. dollar) lower than those in Hanoi.

During the week, global spot gold prices fell to the 4-month bottom at 1,527 U.S. dollars per ounce on Thursday, compared with the lowest point at 1,573 U.S. dollars last week, and the highest level so far this year at 1,790 U.S. dollars on Feb. 29.

Analysts said that the political situation in Greece, the election of the new President in France and investors' worry about Europe's not approving the support package to solve the crisis in Greece, all had impacts to the declining gold prices. In addition, news of the US JP Morgan Chase's huge loss of 2 billion U.S. dollars worsened the global gold market.

Many investors sold out gold and stored their assets in cash and U.S. dollars for safe, reported the Wall Street Journal, quoting an analyst from the European Societe General Bank as saying.

Meanwhile, the International Monetary Fund (IMF) said it will spend 2.3 billion U.S. dollars to purchase gold, although the fund ' s current gold reserve is 2,800 tons. The fund's main borrowers are countries in the eurozone block, with Greece and Portugal topping the list.

The Goldman Sachs forecast gold will increase 26 percent, reaching 1,940 U.S. dollars per ounce in the next 12 months, while Standard Bank said demands of gold from India will increase in August and September, pushing global gold price to hit 1,900 U.S. dollars by this year end.

The global gold declining trend had little impacts on domestic gold prices, which fell down to nearly 5-month low level of 40.82 million VND per tael on Thursday, compared to last week's bottom of 41 million VND per tael. However, the disparity between global and domestic prices still stood at over 2 million VND/tael (95.9 U. S. dollars) in favor of the domestic one, which was much higher than the goal of 400,000 VND (around 19 U.S. dollars) set by the State Bank of Vietnam (SBV).

Local insiders said that the major difference between global and domestic gold prices was not due to the market's supply and demand.

In April, the State Bank of Vietnam (SBV) issued a decree to restrict trade in gold bullion to stabilize the gold market, check hoarding and speculation, narrow the disparity and minimize the influence of the gold market on monetary policy. It forced credit institutions to cease lending and mobilizing gold by May 1, but last week the SBV decided to extend the termination date for gold mobilization and lending till Nov. 25.

Meanwhile, the Vietnamese dong maintained its value against the U.S. dollars this week thanks to the government's interest rate cuts and eased credits to real estate and securities investment. The country's two stock markets rebounded strongly, hitting their 15 month-high records last Tuesday, however they gradually fell during this week.

Although the inter-bank exchange rate remained unchanged at 20, 828 VND per one U.S. dollar (since last Dec. 26), rates posted by commercial banks on Friday reached 20,820 20,870 VND for one dollar buying/selling, the same as Thursday, while on the black market they were traded at 20,870-20,890 VND/dollar.