In an interview posted on the local newswire Thoi Bao Kinh Te Saigon (Saigon Economic Times) on July 2, Tran Hoang Ngan, member of the National Assembly’s Economic Committee cum vice rector of HCM City Economics University, said that Vietnam’s balance of payment in the first six months of this year enjoyed a surplus of $7 billion, trade deficit shrank and foreign currency reserves increased.
According to Ngan, these factors are expected to stabilising the dong/US dollar forex rate in the next quarter.
Earlier, according to the Ministry of Planning and Investment (MoPI)’s socio-economic report in April and the first four months of 2012, the country’s balance of payment in Q1/2012 was estimated to enjoy a surplus of $2 billion.
In addition, currently some sources said that Vietnam should devalue the local greenback but according to Ngan now is not right time.
He added that the country’s CPI (consumer price index) in June decreased partly due to external elements such as continuous falls of oil prices and prices of other commodities. But the resilience of the European economy is still an unknown and if recovering, the prices of these commodities will likely increase again very highly.
In the country, the prices of electricity, water and coal for electricity production have increased, affecting costs, which are not support for low inflation in the future.
For the aforementioned reasons, Ngan said that if devaluating the dong by this time, the return possibility of high inflation in the fourth quarter is very high.