Dollar, gold lose investment advantages: Experts

The Vietnamese government’s determination to carry out measures under Resolution 11 have begun to have a major impact on real estate and financial markets, Nguoi lao Dong (The Labourer) local newspaper cited experts as saying at a workshop on real estate – finance market in 2011 held in Hanoi on April 9.

According to experts at the workshop, gold and dollar are losing their investment advantages. After the closure of the free forex market in February 2011, the State Bank (SBV) has decided to control the ceiling interest rate of foreign currency at 3 percent per year, while increasing the foreign exchange reserve requirement of credit institutions by 2 percent. Therefore, banks are forced to reduce the mobilisation of foreign currency, making the attraction of the dollar no longer exist.

Dr Le Xuan Nghia, vice Chair of the National Financial Supervision Committee said that from now, the government will minimise taking deposits and loans in foreign currency into the banking system. This strategy will be resolutely implemented over several years to achieve the goal of shifting from the foreign currency lending relationship to trading and putting an end the dollarisation situation.

The buying and selling of gold bars will now be made only in formal markets licensed by the State Bank.

Meanwhile, the credit crunch for real estate has become an issue of the greatest difficulty in 2011, but not caused a shock to the real estate market.

Luong Tri Thin, Chair of Dat Xanh (Green Land) Group, said that cash flows from other investment channels like stocks, gold, dollars are moving into real estate.

According to Truong Dinh Tuyen, real estate is a safe “shelter”. This market has huge potential and creates economic growth, but all of the economic crisizes mostly come from real estate. Thus, the State should have an appropriate and tight management policy. – Vietbiz24

Tags: vietnam gold, Vietnam gold market, Vietnam gold prices

Posted by VBN on Apr 13 2011. Filed under Banking-Finance, Gold. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry