Will Vietnam's foreign exchange reserves reach 95 billion USD by the end of the year

DNHN - Moody anticipates that Vietnam's foreign exchange reserves will recover by the end of the year and reach $95 billion as the SBV rebuilds its reserves.

Moody predicts that Vietnam's foreign exchange reserves, excluding gold, will recover to $95 billion by the end of this year as the State Bank rebuilds reserves.

An analyst in Singapore, Nishad Majumdar, stated, "The recent appreciation of the dong (VND), which reflects an improved external position, will allow the State Bank of Vietnam to rebuild. The forex buffer was depleted during last year's dollar rally.

According to the International Monetary Fund (IMF), Vietnam's foreign exchange reserves reached $88,3 billion in January of this year.

Vietnam's foreign exchange reserves will reach $95 billion by the end of the year.
Vietnam's foreign exchange reserves will reach $95 billion by the end of the year..

Even if exports decline, Mr. Majumdar estimates that the recovery of the tourism industry and the steady inflow of foreign direct investment will help increase national reserves. As the dollar's strength weakens, the dong has gained 6% over the past six months, in line with the uptrend of Asian currencies. A stronger VND will decrease the value of the government's external debt in domestic currency.

Governor Nguyen Thi Hong reported that the State Bank was closely monitoring the situation, combining monetary policy instruments with flexible management of the central exchange rate. The results indicate that the exchange rate is stable, as the SBV has purchased approximately 6 billion USD since the beginning of the year.

Credit increased by 2.75 percent as of April 25 compared to the end of 2022. Credit expansion was sluggish because, at the start of the year, it was not constrained by credit growth limits or liquidity conditions. The credit institution system has been improved. This indicates that the rate of capital absorption is low, for the following reasons: Due to the financial sector's weakness, some businesses need to borrow capital despite a lack of output, a decline in orders, and a corresponding decrease in demand and capital. Time impacted by the COVID-19 virus should not qualify for loans; Due primarily to legal factors, the increase in real estate credit was not as significant as in the past (real estate credit increased by 3.51%).

P.V (t/h)

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