Vietnam Forex Reserve Forecasted at $15.8b in 2012: JPMorgan Chase

JPMorgan Chase Bank forecasted Vietnam’s foreign exchange reserve to reach $15.811 billion in 2012, up from $12.561 billion in 2011, the local newswire NDHMoney.vn reported.

If the country’s inflation falls as forecasted, its forex reserve will increase as local people switch to domestic currency, the report said.

Tight monetary policies started to work, as clearly shown through the deceleration of inflation since August and narrowing trade deficit in Vietnam, the report said, emphasising that inflation has the strongest influence on the country’s balance of payments (BoP).

Vietnam is estimated to enjoy a BoP surplus of $1.8 billion in 2011, JPMorgan said, expecting the figure to climb to $3.25 billion in 2012.

In 2012, foreign direct investment (FDI) to the country is expected to reach $10.5 billion, and foreign indirect investment (FII) will rise to $500 million from negative $5.6 billion in 2011, JPMorgan Chase Bank predicted.

 

Category: Finance