Vietnamese Jewelry Sales Dip on High Inflation

The gold volume used to make jewelry in Vietnam decreased by 16 percent to 9.7 million tones in the first half of 2008 from a year earlier, the World Gold Council in Vietnam said on Wednesday.

Industry officials said that an upsurge in inflation and rocketing gold prices were to blame for a drop in jewelry sales which then led to a decrease in the demand for gold. As a result customers have shifted their sights to jewelry made of other precious metals like platinum and silver.

Saigon Jewellery Company, one of the country’s biggest gold importers and distributors, said that it did not see any increase in the volume of gold it sold despite a 44 percent increase in its turnover for the first eight months of the year.

Phu Nhuan Jewellery Company noted that both its turnover and profit had increased through the end of August by 26 percent and 19 percent respectively from the previous year.  The company noted, however, that customers were choosing jewelry pieces with lower gold content and that pieces ranging between 10 karat and 18 karat accounted for 65 percent to 67 percent of the sales.

Jewelry traders have now set their hopes on the upcoming wedding season, which is the highest selling season in the year for gold traders.