In the context of the Covid-19 epidemic being under good control, most economic sectors in Vietnam has experienced positive development. In particular, industrial production continued to flourish. The index of industrial production was estimated to increase by 3.6% MoM in October, higher than the 2.3% increase in September. The processing and manufacturing industry witnessed an increase of 8.3% over the same period last year. Generally, in the first 10 months of 2020, the IIP was estimated to increase by 2.7% over the same period last year, much lower than the 9.5% increase in the same period in 2019.
Along with positive signals in production, domestic trade also maintained its upward trend with October’s total retail sales of consumer goods and services increasing by 2.4% over the previous month and by 6.1% over the same period last year. Generally, in the first 10 months of 2020, the total retail sales of consumer goods and services reached 4,123 trillion VND, an increase of 1.3% over the same period last year. If the price factor was excluded, it would decrease by 3%.
Meanwhile, the macroeconomy continued to be stable, and inflation was well controlled. Consumer price index in October 2020 was the lowest level in the 2016-2020 period, mainly due to the adjusted prices of educational services. The average consumer price index in the first 10 months of 2020 increased by 3.71% over the same period last year. With this result, if there are no abnormal fluctuations, it is likely that Vietnam will achieve the inflation control target set by the National Assembly.
The number of newly established enterprises in October 2020 increased by 18.4% over September 2020. There was an increase of 18.5% in the number of enterprises returning to operation. Generally, in the first 10 months of 2020, there were nearly 111.2 thousand newly established enterprises, down 2.9% against the same period last year. The average registered capital per newly established enterprise reached 14.3 billion VND, up 14.4%.
Although there are still many difficulties due to complicated developments in the global economic environment, and foreign investment has plummeted (total FDI in Vietnam as of October 20, 2020 decreased by 19.4%), it is expected that the domestic economy will continue to prosper in the coming months.
In the past week, the USD / VND exchange rate remained stable in the official market but increased in the unofficial market. At VCB, compared to the previous week, the exchange rate of USD / VND stayed unchanged, at 23,060 VND / USD (buying side) and 23,270 VND / USD (selling side). Compared to the beginning of 2020, the USD / VND exchange rate on the selling side has increased by 40 VND / USD (equivalent to an increase of 0.17%). In the unofficial market, the USD / VND exchange rate increased by 30 VND / USD on the buying and by 20 VND / USD on the selling side, to 23,200 VND / USD and 23,220 VND / USD, respectively.
At the State Bank of Vietnam, the USD / VND exchange rate was stable at 23,175 VND / USD, which is 700 VND / USD lower than the ceiling price. Compared to the previous week, the USD exchange rate on the selling side decreased by 19 VND / USD to 23,844 VND / USD and was 50 VND / USD lower than the ceiling price.
Meanwhile, the central exchanged rate announced by the State Bank applicable to October 29, 2020 was 23,198 VND / USD, up 18 VND / USD (equivalent to an increase of 0.08%) compared to the rate announced the previous week. Since early 2020, the central exchanged rate has been adjusted to increase by 25 VND / USD (equivalent to an increase of 0.11%).
The USD / VND exchange rate has been stable recently. Vietnam aims to maintain financial stability, prevent shocks and limit external impact through flexible management of monetary policy instruments. The State Bank of Vietnam operates the exchange rate policy within the framework of a general monetary policy in order to achieve the goal of maintaining macroeconomic stability. Vietnam's exchange rate policy is not aimed at creating international trade competitive advantages or supporting individual manufacturing industries. In fact, if the VND is devalued, it will cause great damage to the economy.
The world gold price fell sharply in the context of increasing selling pressure as investors sold gold to compensate for stock losses.
In the short term, gold prices will decline because of fluctuations in the stock market and the value of the USD. In the long term, however, the opposite might be true. The World Bank believes that gold prices will not have much volatility in 2021 after it has risen sharply this year. Gold prices will be around 1,900 USD / ounce.
At the end of the week, spot gold price was 1,876 USD / oz, which was a decrease of 45 USD / oz (equivalent to a decrease of 1.5%) compared to last week. Gold futures price in December 2020 on Comex New York was 1,877 USD / oz, down 47 USD / oz (equivalent to a decrease of 2.4%) compared to the previous week. On the Kitco trading exchange, spot gold prices were at 1,877.80 - 1,878.80 USD / oz, down 46.1 USD / oz (equivalent to a decrease of 2.4%) compared to the previous week.
World gold price was about 3.0 million VND / tael lower than the domestic gold price.
Domestically, the price of gold has decreased. Specifically, in Hanoi, SJC gold bought in and sold out price was 55.8 and 56.32 million dong / tael, respectively.
Source: Ministry of Industry and Trade
Compiled by VietnamCredit