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Few SOEs sell foreign currencies to banks
Bankers say only a few of state owned enterprises (SOEs) have sold foreign currencies to bankers over the last week, since the day the Circular No 13, which asks state owned economic groups and general corporations to sell foreign currencies to banks, took effect on July 1.
Commercial banks have confirmed that the volumes of foreign currencies sold by the enterprises have not increased significantly. An officer of a state owned bank said that enterprises have been selling foreign currencies in dribs and drabs, and that he still cannot see any signs showing that the foreign currency supply would increase.
In March 2011, the State Bank announced that the volume of foreign currency balance (both demand deposits and fixed term deposits) of state owned enterprises on their accounts had reached 1.6 billion dollars. If the volume of dollars is sold to banks, the foreign currency supply would increase considerably.
However, the above said officer said that what he could see in the last 10 days was that the volume of foreign currencies sold to banks every day was much lower than the announced figures. He said that enterprises seem to have the plans to use the foreign currencies they have during this month; therefore, they do not have much to sell to banks.
Under the Circular No 13, from July 1 to July 7, state owned enterprises have to report about the plan to use their foreign currencies in July. The amounts of foreign currencies the enterprises do not plan to use in the month will be sold to credit institutions. After July, the reports must be submitted within the first five days of the months.
The SOEs which have to sell foreign currencies include economic groups, generation corporations and the companies where the state holds more than 50 percent of capital.
Bankers said that the demand for purchasing foreign currencies has been increasing slightly recently. However, the demand is not big enough to put pressure on the dong/dollar exchange rate.
Analysts believe that the demand for foreign currencies would reach its peak in early fourth quarter, when enterprises need foreign currencies to import materials for the new production season. The fourth quarter will also be the time when many loans in foreign currencies become due, and enterprises – the foreign currency borrowers – have to purchase foreign currencies to pay bank debts
However, experts have calmed the public down that if the State Bank keeps the current tightened monetary policies, the dong would be stable in the last six months of the year.
Recently, Standards & Chartered Bank has changed its predictions about the dong/dollar exchange rate. It has forecast that there would be a slight depreciation of the dong in 2012, instead of the third quarter of 2011 as previously predicted.
Meanwhile, the downward trend in the dollar price still can be seen on the free market. The dollar price on Thursday, July 7 decreased by 50-60 dong per dollar over that of the previous day. Especially, the dollar price on the free market was lower by 100 dong per dollar than the price quoted by commercial banks. In general, people have only seen the opposite thing: the dollar price quoted by banks is always higher than that in the free market.
The owner of a foreign currency exchange shop on Ha Trung Street on July 7, posted the price of 20,560 dong per dollar (Purchase) and 20,580 dong per dollar (Sale), a decrease of 10 dong per dollar from the previous day.
A big gold shop on Nguyen Thai Hoc Street in Ba Dinh district in Hanoi, collected dollars at 20,560 dong per dollar and sold at 20,585 dong per dollar. The owner of the shop said that the gap between the sale and the purchase prices has been narrowed, which allows traders to earn smaller profits. However, he hoped the purchasing power would increase.
Vietcombank purchased dollars at 20,570 dong per dollar at 12 pm of July 7, and sold at 20,670 dong per dollar, increasing the purchase price by 10 dong and the sale price by 40 dong.
The interbank exchange rate announced by the State Bank of Vietnam has been staying at 20,613 dong per dollar since July 2.
vietnamnet
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