HCMC-based commercial banks sell US$9.6bln in May
Print 
Commercial banks in Ho Chi Minh City bought $US9.5 billion and sold $US9.6 billion in May, according to recent statistics from the State Bank of Vietnam’s HCMC branch.
As much as 31.5 percent of the dollars were bought from economic organizations, over 8.1 percent from different sources including overseas remittance and dollar exchanges, and the rest from credit institutions.
Of the total dollars sold, 33.2 percent were bought by local enterprises to meet demand for dollars payment, nearly 4.7 percent was sold to businesses and to individuals for overseas study, medical treatment and resettlement abroad.
Dollar prices on Wednesday were quoted at VND20,540 and VND20,680 per dollar at local commercial banks, down VND170 per dollar from one week earlier.
The State Bank of Vietnam (SBV) has recently announced having purchased US$1 billion since late April and would continue to buy more dollars this week as well as next week, local newspaper Thoi Bao Kinh Te Saigon quoted an SBV official as saying.
According to this official, along with spending a large amount of dong to buy the foreign currency, some measures will likely be taken to fight inflation, which is expected by the monetary market.
The State Bank has chosen the time of the lowest exchange rate in the past three months to buy US dollars. Last week, the purchase price of U.S. dollars at credit institutions dropped to below VND20,500 per dollar, while the selling price was close to VND20,610 a dollar.
The selling price of the SBV Transaction Centre remained at the ceiling, but the purchase price had fallen to VND20,600 per dollar, lower than the VND20,700 a dollar that had been maintained for several weeks before.
The SBV official said that in a bid to neutralize the same amount of money pumped out to buy U.S. dollars, the State Bank may increase the reserve requirement or will issue bonds with the coupon rate of 18 to 20 percent per year.
After the SBV buys $1billion, Asian Development estimated that Vietnam's forex reserves will rise to about US$13.5 billion which will further increase as the central bank continues the purchase.
Asian Development Bank's statistics showed that by the end of 2010, Vietnam's forex reserves were estimated at US$12.4 billion, or 1.9 months worth of import, adding that the SBV should buy US$6.6 billion worth to reach a safe level of forex reserves or 12 weeks of import.
