Bank deposit interest rates will likely drop to about 10 per cent per year if the government achieves its set target of controlling the rate of inflation at 9-9.5 per cent by year-end, said State Bank Governor Nguyen Van Binh.

Such a decrease is possible given the fact that the monthly consumer price index (CPI) has gradually slowed down at a rate of less than 1 per cent since August last year. Moreover, the State Bank of Vietnam (SBV) is bent on solving the liquidity of some credit institutions.

The gold market, he added, must ensure people's right to reserve gold while helping banks mobilize capital resources for socio-economic development.

The SBV will submit a project in this connection to the Government. Accordingly, the State will mobilize gold through credit institutions meaning that it will not intervene in the market directly.

Effective measures will be taken; for instance, by trading gold in the world market the State will be able to control fluctuations in gold prices, secure the people's assets and exchange gold into foreign currency to serve the need of socio-economic development.

In 2012, the SBV plans to strictly deal with weak financial institutions to ensure the stability of the whole credit system in Vietnam for the benefit of sustainable development, Binh said.

VOV News