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Dollar falls after record high
The greenback on Feb. 24 was down to VND21,880 after reaching a record Vietnamese high of VND22,400 on Sunday.
This follows a State Bank order for enterprises to sell excess US dollars to commercial banks.
Foreign exchange (FX) vendors on Ha Trung and Tran Nhan Tong streets traded the dollar at VND21,880-21,970, down VND130-170 from Wednes-day's rate or VND430 from Sunday's rate.
Trading yesterday was quieter than a few days earlier. After the central bank devalued the dong by 9.3 per cent against the dollar on February 11, the FX market seemed confused and the dollar appreciated for 10 consecutive days.
"It was a natural response, but the FX market is gradually stabilising. Some entrepreneurs told me they started selling dollars to banks," State Bank of Viet Nam's Governor Nguyen Van Giau said.
In fact, enterprises are the main dollar holders in Viet Nam. In a random check last year, the State Bank of Viet Nam reported that enterprises kept about US$1-1.3 billion idle in bank accounts instead of selling to commercial banks.
On Feb. 24, Prime Minister Nguyen Tan Dung stated that national economic groups and corporations could no longer hold on to US dollars and must sell them back to commercial banks. In turn, the banks must sell sufficient dollars to enterprises at quoted prices when they need them to settle overseas accounts. The move, in principle, will improve the dollar liquidity of banks and help ease tension on the FX market. This may cool the pressure on the US dollar.
The depreciation of the dollar on the street yesterday pushed gold prices down by VND100,000 per tael – or a total of VND800,000 per tael from last Saturday.
SaigonJewellery Company, the Sacombank Jewellery Company, Bao Tin Minh Chau, Agribank Jewellery Compant and Phu Nhuaân Jewellery Company were trading gold at VND37,57-37,69 million ($1,707-1,713) per tael (One tael equals 1.2 ounces).
Meanwhile, global spot prices for gold edged up 0.1 per cent at $1,413.35 an ounce as spreading turmoil in Libya and soaring oil prices stoked the worry of slower economic growth. Investors seeking security are turning to gold bullion.
Late yesterday, gold price rebounded to VND37.76-37.88 ($1,716-1,721) per tael, and the dollar was up to VND22,000.
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