Vietnam Unlikely to Tighten Monetary Market: Wall Street Securities
Vietnam is unlikely to raise base interest rate to tighten the monetary market, which means that the stock market will remain its bullish trend in medium and long-term, Wall Street Securities Company (WSS) forecast.
Firstly, the Ministry of Finance estimates Vietnam’s CPI in March will rise between 0.5% and 0.6% from Feb, driven by higher costs of electricity, petrol and coal.
The government will focus on stabilizing essential goods prices and preventing speculation rather than tightening the monetary policy, WSS said.
Secondly, stock traders expect the central bank will remove ceiling deposit rates currently capped at 10.5%, which will help boost liquidity of the economy.
Thirdly, the government will prioritize an economic growth of between 6.5% and 7% this year while taming inflation below 10% instead the 7% target; thus, it will not increase the benchmark rate.
The broker said CPI, credit growth, trade balance figures in March will be announced this week, which will drive the market movement in the short term. Both foreign and domestic investors strongly bought property stocks during last week. (stockbiz.vn)
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