Vietnam’s economy is facing a lot of difficulties caused by the Covid-19 epidemic outbreak. Many production companies have been forced to stop operating, therefore, their orders cannot be performed on time.
Facing such difficulties, import and export activities have also been affected. Statistics shows that the total import-export turnover of Vietnam in May 2021 reached 53.5 billion USD, down 1.5% compared to the previous month. In particular, export turnover in May 2021 decreased by 2.1% from the previous month to 26 billion USD and import turnover decreased by 1% to 27.5 billion USD. Generally in the first 5 months of 2021, Vietnam’s total import-export turnover is estimated at 261.75 billion USD, up 33.2% over the same period last year.
In the past week, the USD / VND exchange rate increased on the official market but decreased on the unofficial market. At VCB, compared to the previous week, the exchange rate of USD / VND increased by 10 VND / USD, to 22,920 VND / USD (purchased) and 23,150 VND / USD (sold). Compared to the beginning of 2021, the USD / VND has decreased by 40 VND / USD.
On the unofficial market, the USD / VND exchange decreased by 20 VND / USD on the buying side and by 10 VND / USD on the selling side, to 23,180 VND / USD and 23,230VND / USD, respectively.
At the State Bank of Vietnam, the USD / VND exchange rate was stable at 23,125 VND / USD, which is 706 VND / USD lower than the ceiling price. Compared to the previous week, the USD exchange rate on the selling side decreased by 18 VND / USD to 23,782 VND / USD and was 50 VND / USD lower than the ceiling price.
Meanwhile, the central exchanged rate announced by the State Bank applicable to May 27, 2021 was 23,137 VND / USD, down 17 VND / USD compared to the rate announced the previous week.
Minutes of the US Federal Reserve's April 2021 meeting, released last week, illustrated that the agency may discuss changes to its asset purchase policy at upcoming meetings. However, the FED still affirmed to continue to maintain the loose monetary policy, and believed that inflation is only temporary and the US economy is still far from the growth target.
This factor has kept the listed USD/VND exchange rate of Vietnam’s domestic commercial banks unchanged at 22,920 - 23,150 VND/USD (buying - selling).
The world gold price has surpassed 1,900 USD/ounce due to the weak USD and investors' concerns about inflation while the Fed kept the stance of maintaining the ultra-easy monetary policy.
This immediately raised concerns among investors that inflation would rise sharply and could fall out of control as commodity prices have recently surged at an alarming rate. Prices of iron and steel and many other raw materials for production have continuously set new highs.
Gold prices have hit a four-and-a-half-month high as the dollar hit its lowest in a similar period. Yields on US bonds also fell.
Gold price is forecasted to increase further following the trend of cash injection of the US as well as many countries around the world. Gold may reach 2,000 USD / ounce this year. Investors fear that inflation will rise out of control.
Several officials of the Federal Reserve have said that while the economic recovery will likely drag on inflation, it won't last too long and they won't be pulling back on support measures, including maintaining record low interest rates in the the foreseeable future.
At the end of the week, spot gold price was 1,903 USD / oz. Gold futures price in June 2021 on Comex New York was1,906 USD / oz, which is an increase of 24 USD / oz (2.9%).
World gold price was about 53.9 million VND / tael, which is 2.7 million VND lower than the domestic gold price.
The domestic gold prices also saw an increase due to concerns about the impact of the Covid-19 epidemic. In Hanoi, SJC gold price increased by 90 thousand VND / tael on the buying and selling sides, to 56.07 – 56.44 million VND / tael.
Source: Ministry of Industry and Trade
Compiled by VietnamCredit