VietNamNet Bridge – The gold and dollar markets began cooling down yesterday afternoon after two scorching days, and after the strong confirmation by the State Bank of Vietnam that the central bank is powerful enough to stabilize the market.

Dollars were traded at VND17,350/US$ yesterday morning, but the price slightly decreased in the afternoon to VND16,900/US. As such, the dollar price had reduced by VND500/US over the day before.

The dollar price decrease seemed to be good news. People yesterday did not rush to buy dollars as they did the day before, but kept waiting to see the gold and dollar price performance.

Kim Ngan, the owner of a gold shop on Hai Ba Trung street in HCM City, said that the number of dollar buyers yesterday sharply decreased over the previous day. She said that the dollar supply yesterday became profuse, and the clients, who bought more than ,000, could negotiate with the sellers to get the best prices.

Nguyen Thanh Luu, a buyer at Kim Tan Gold shop on February 3 Road in HCM City, complained that he lost VND400,000 yesterday as the dollar price dropped in the afternoon.

At Kim Thanh Tan Gold Shop on Cong Quynh street, related that she received ,000 from a relative in the US and she did not sell the dollars the day before as she planned, because she had an unexpected deal. And the tardiness has brought her the loss of VND3mil.

Investors: surfing on investments and keeping dollars

Thanh Dung in district 7, HCM City is a securities investor. However, she has decided to use all the capital she has to buy dollars. Dung admitted that this really is a risky investment channel, but said that only risky deals can bring high profit.

Other people buy dollars simply to keep under their pillows. They fear that the dollar price would increase further in some more days and rush to buy dollars in big quantities. As a result, the dollar price escalated in the last several days due to the virtual demand.

The sharp price increases have made businesses suffer. Cong Huy, Director of a privately run import-export company, complained that he could not buy dollars from banks and he had to buy them on the black market at very high prices to get money for an import deal.

Banks lacking dollars

While the black market was scorching in the last few days, the VND/US$ exchange rates offered by commercial banks did not see considerable changes. Yesterday, banks in HCM City quoted the same purchasing and selling prices of VND16,230/US. This shows that banks themselves are lacking dollars, and they have to accept buying dollars at high prices, with which they cannot make profit.

An officer of a bank on Nguyen Cong Tru street said that the bank now only sold dollars to loyal clients. Other banks said that they will consider the volume of transactions and number of clients, and who the clients are, to decide whether to sell dollars.

Bankers all said that the dollar price fluctuations do not greatly affect banks’ foreign currency transactions. They said that people rushed to buy dollars in the last few days because they heard the news about the higher inflation of rate of 15,9% in the last five months.

An official from the State Bank of Vietnam said that the dollar price would be stabilized in one or two days with the dollar price hovering between VND16,300 and 16,500/US.