People wearing face masks amid fears of the spread of Covid-19 sell their jewelry in a gold shop in Bangkok's Chinatown on April 15, 2020. Photo: AFP/Mladen Antonov

Thais are flocking to Bangkok’s Chinatown to sell their gold jewelry as the price of the precious metal spikes and the economy tanks due to the coronavirus pandemic.

Gold surged to a seven-year high on Tuesday to US$1,731.25 an ounce, following global moves led by the US to reinflate economies with trillions of dollars of stimulus measures.

That has boosted the price of gold across the world, tempting many to sell their stocks of the precious metal at a time of economic hardship without recent precedent.  

Many Thais buy gold jewelry as an investment in times of plenty, to be sold when prices rise or belts tighten.

In Bangkok, where a virtual lockdown has taken root for a fortnight, hundreds flocked to Yaowarat, Bangkok’s Chinatown, to trade bracelets, necklaces and rings for cash as local gold prices jumped more than 20%.

“I don’t have any savings so I decided to sell the gold I have for cash to keep me afloat during this time,” said Thanakorn Promyuyen, a 39-year-old street vendor.

Traders have bought tens of millions of dollars worth of gold since Tuesday, according to Jitti Tangsitpakdi, a chairman of a trade association.

“One shop bought 200 million baht ($6.1 million) of ornaments and bars,” he said, explaining businesses whose revenue has been strangled by the lockdown are being forced to sell their gold savings.

“Their businesses are in bad shape; better to sell gold and keep cash,” he added.

“In over 60 years and I never seen people queue like this to sell their gold.” 

Thailand’s economy is forecast to contract by more than 5% this year after the virus shuttered borders – killing the cash cow tourist industry – leaving millions unemployed.

“I don’t have any income, only expenses,” said 43-year-old Aumporn Pansa as he sold his jewelry. “I have kids to take care of as well as monthly bills, so I had to come here and sell.”