Myanmar regime’s sale of gold coins is not bringing down the gold price as they are being sold too near the market rate, according to dealers.
On Monday the junta started selling gold coins at a gems emporium in Naypyitaw for 2.95 million kyats per tical (16 grams) while the market price is around 3 million kyats.
On Tuesday, the market price reached 3.15 million kyats and was around 3.12 million kyats on Wednesday.
A trader said: “If they sell at a price lower than the market rate, traders would buy and sell their gold at a lower rate. But as they are selling near the market price, gold prices have gone up. The policy is not working.”
The gold price has risen as citizens have bought gold as the kyat slumped because since the military coup in February 2021. In January 2021 the gold price was slightly over 1.3 million kyats per tical and the exchange rate was around 1,300 kyats per dollar.
The regime announced last week that it would sell gold coins to the public to bring down rising prices.
The regime is selling one tical coin per person. Buyers have to present their ID cards. The regime did not say how many gold coins were being sold.
Junta spokesman Major General Zaw Min Tun told the media that the coins would be sold at international prices and that they were not from the country’s gold reserve. He said the regime would sell enough gold to affect the domestic market.
The gold price quoted by the Yangon Region Gold Entrepreneurs Association on Wednesday was 1.98 million kyats per tical at the official exchange rate of 2,100 kyats per dollar. The market exchange rate is around 3,600 kyats.
The international gold price is approximately US$1,695 per ounce (28 grams).
The coins show independence hero General Aung San, the father of jailed State Counselor Daw Aung San Suu Kyi, minted in 2018 under her National League for Democracy government.
Gold coins are only being sold in Naypyitaw with no dates announced for sales in Yangon and Mandalay.