Vietnam’s economy is really on recovery, which is evidenced by the macroeconomic data for the first quarter. Accordingly, GDP in the first quarter of 2021 is estimated to increase by 4.48% over the same period last year, higher than the growth rate of 3.68% in the first quarter of 2020. In addition to the recovery of key industries, growth in the first quarter was also strongly supported by agriculture, forestry and fishery whose growth rate was 3.16%, contributing 8.34% to the general growth. The macro-economy continued to be well controlled, and the average CPI in the first quarter of 2021 rose only 0.29%, the lowest increase in the past 20 years.
Production activities also recorded a fairly positive growth. The index of industrial production (IIP) in March 2021 is estimated to increase by 22.1% over the previous month and by 3.9% over the same period last year. For the first quarter of 2021, the IIP is estimated to increase by 5.7% over the same period last year. Vietnam's PMI as calculated by IHS Markit also increased to 53.6 points in March 2021 compared to 51.6 points in the previous month, showing that the manufacturing sector has improved.
The number of newly established enterprises in the first quarter of 2021 decreased by 1.4% compared to the same period last year but the total registered capital increased by 27.5% due to an increase in the number of enterprises whose registered capital of over 100 billion VND.
As of March 20, 2021, the total foreign investment capital in Vietnam including newly registered capital, adjusted registered capital and capital contribution and share purchase by foreign investors reached nearly 10.13 billion USD, an increase of 18.5% over the same period last year. Meanwhile, realized FDI in the first quarter of 2021 was estimated at 4.1 billion USD, up 6.5% over the same period last year.
Although the economy clearly recovered with some important achievements, the GDP growth rate in the first quarter of 2021 was still lower than the target set by the Government. In addition, despite the fact that inflation in the first quarter was still low, it is not easy to main inflation rate below 4% in the context of many countries implementing a series of economic stimulus packages and crude oil prices increasing strongly.
Exchange rate
In the past week, the USD / VND exchange rate increased on the official yet experienced a sharp decrease on the unofficial markets. At VCB, compared to the previous week, the exchange rate of USD / VND increased remained stable at 22,960 VND / USD (purchased) and 23,170 VND / USD (sold), respectively. Compared to the beginning of 2021, the USD / VND has decreased by 20 VND / USD.
On the unofficial market, the USD / VND exchange rate decrease by 70 VND / USD on both buying and selling sides, to 23,900 VND / USD and 23,950VND / USD, respectively.
At the State Bank of Vietnam, the USD / VND exchange rate was stable at 23,125 VND / USD, which is 814 VND / USD lower than the ceiling price. Compared to the previous week, the USD exchange rate on the selling side increased by 19 VND / USD to 23,884 VND / USD and was 55 VND / USD lower than the ceiling price.
Meanwhile, the central exchanged rate announced by the State Bank applicable to April 1, 2021 was 23,242 VND / USD, up 24 VND / USD compared to the rate announced the previous week.
Gold price
The world gold price fell because the USD continued to reach higher peak, while oil prices fell and US bond yields increased. Besides, investors continue to invest in the stock market. It is forecasted that gold prices will continue to plunge when purchasing power is weak.
The economic stimulus package worth 1,900 billion USD is being disbursed, leading to higher yields, which is not favorable for gold. Besides, the faster-than-expected growth of manufacturing activities in China is also the reason why gold prices go down. Official data shows that manufacturing in China grew at a faster rate than expected in March 2021, as factories reopened after the Chinese New Year holiday to meet the growing demand.
At the end of the week, spot gold price was 1,684 USD / oz. On the Kitco trading exchange, gold prices were 1,708.4 – 1,709.4 USD / oz.
World gold price was about 47.7 million VND / tael, which is 7.0 million VND lower than the domestic gold price.
The domestic gold prices continued to decrease. In Hanoi, SJC gold price decreased by 700 thousand VND / tael on both selling and buying sides, to 54.45 – 54.85 million VND / tael.
Source: Ministry of Industry and Trade
Compiled by VietnamCredit
