Siripol Yodmuangcharoen, director-general of the department, yesterday called a meeting with the Office of the Consumer Protection Board (OCPB) and the Gold Traders' Association (GTA) to seek their cooperation.

The GTA has said it would discuss with its members how to initiate an hourly announcement, keeping in mind it also has to inform gold traders upcountry as well as the ITD.

The ITD together with the OCPB have also agreed to command all gold shops to use a two-digit weight measure instead of the current one-digit system, starting from early next year.

Siripol said they wanted to install a unified system out of concern for consumers.

There are currently approximately 7,000 gold traders nationwide, of which half already use two-digit weighing machines.

The association has forecast that the world market price for gold will continue to climb.

"The gold price will climb higher than $800 [Bt30,400]per ounce this year but will not exceed $1,000 per ounce," predicted Jitti Tangsithpakdi, GTA president. A weak US dollar and high speculation in the world's gold market have caused gold prices to jump, according to Jitti. This environment has led many countries to stock up on gold instead of US dollars.

The expectation of inflation in the long run has prompted the gold price to soar. As a result, consumers and investors should buy gold as a long-term investment rather than for speculation, according to Jitti.

Recently the price in the world market has surpassed $700 per ounce (31.1035g), while the domestic price hit Bt12,550 (US$330.26) per baht weight - or 15.24g yesterday.

On Monday, the gold price fluctuated in the domestic market, with the highest price of the day recorded at $719 per ounce and the lowest at $689 per ounce.

Jitti said rising demand of gold reserves has caused this instability.

He added that with the gold price climbing, domestic gold sales have dropped 30 to 40 per cent, forcing some goldsmiths to abandon the business.

The GTA reports that there are 300,000 goldsmiths in the country.

However, Jitti said the association had yet to survey how many goldsmiths have suspended operations, or how many gold shops have be forced to close down due to slow sales. He added that gold traders had tried to keep them in the business as long as possible.

A gold trader from in a rural area said if prices continued to increase, many small and medium-sized gold shops in the provinces may be forced to closed down.

The trader, who asked for anonymity, said that the government should allow the market force to run unchecked as too stringent a control on gold trading would hurt small enterprises.

Jitti said the recent price adjustment to the goldsmith's fees to Bt400 per baht weight was fair for all concerned.

This cost of Bt400 per baht weight is the only middleman price that the association has created and is adjustable, depending on the design of gold trinkets.

Jitti said the GTA had not adjusted the goldsmith's charge for about twenty years, but now is time to adjust it in order to help gold businesses.

Petchanet Pratruangkrai

The Nation