ADB estimates Vietnam FX reserves up around 25 pct in Q1

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Vietnam's typically low foreign exchange reserves rose by around 25 percent to an estimated US$17 billion at the end of the first quarter from late 2011, the Asian Development Bank said.

The dollar/dong exchange rate in unofficial markets has been stable following tighter measures to control the domestic gold market and more dollar funds have become available at banks, allowing the central bank to boost its reserves of the greenback.

ADB country economist Dominic Mellor said on Wednesday he believed reserves had climbed from $13.8 billion at the end of last year. The State Bank of Vietnam does not publish forex reserves on a regular basis.

The Vietnamese dong has been stable so far this year, with the mid-point rate set daily by the central bank at VND20,828 per dollar, unchanged since late December, following a lower-than-expected trade deficit in 2011 of $9.5 billion.

From next month, banks will have to reduce the amount of foreign currency they hold at the end of each day, following a central bank ruling to prevent dollar hoarding and control the foreign exchange market.

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