The U.S. dollar rose by more than 1 per cent in the week on domestic unofficial market to exceed VND18,000/US$1 threshold for the first time this month.
By late afternoon of April 13, the greenback stayed firm at VND17,980/US$1 (purchase) and VND18,020/US$1 (sales) in gold shops in Hanoi and HCM City, up VND80 against the previous week.
Analysts said that people have recently withdrawn their dong deposits from banks to buy U.S. dollars for fear of saving rate decrease after the State Bank of Vietnam (SBV) announced to lower some major interest rates.
In addition, soaring demand from importers and gold traders is also another reason for the strong appreciation of U.S. dollars against Vietnamese dong.
Over the past weeks, importers' demand to buy dollars to settle contracts surged as they bought more goods and raw materials to take advantage of the current lower prices.
Private gold traders have recently sought more of the currency to smuggle in gold to take advantage of the high local prices, which were about VND500,000 per tael higher than world prices this week.
The exchange rate performance in the official market, however, proves to be quite contradictory to the one in the black market: while it keeps going down in the former, it has been going up in the latter.
On the interbank market, the VND/USD exchange rate has been lowered continuously. The exchange rates announced by the SBV for April 13 were VND16,938/US$1, down by VND1/US$1 over the previous transaction day.
Bui Kien Thanh, Senior Advisor to KHM Inc, General Director of IAMC (International Asset Management Company), said that the dollar price increase in the last time was the result of the pressure on devaluating the VND which appeared last year.
By the end of 2009, the VND may depreciate by 5 per cent or more against the dollar, Thanh predicted.
The State Bank of Vietnam, the country’s central bank, said that Vietnam has a total forex reserve of nearly US$40 billion, a trade surplus of US$1.647 billion. (News)
Vietnamese
