At the moment, securities and real estate are still two appropriate investment channels
Talking about this year’s inflation, economist Dr. Ngo Ngoc Quang (Lecturer of Foreign Trade University) said that investors first need to understand the nature of inflation. Accordingly, economic growth will often be accompanied by inflation. If inflation remains under control, that’s not too much of a concern.
However, in the case of inflation but not accompanied by economic growth (deflation), the situation will be more dangerous than rising inflation. The case of “Japan’s lost decade” is a classic example of the consequences of deflation.
Identify the source of current inflation, according to Dr. Ngo Ngoc Quang, current inflation pressure comes from cost push. The reason comes from the high price of petrol and fuel, which has a very large cost spread in the economy.
Although under pressure from oil prices, but not because of that, Vietnam does not have a positive side. The exchange rate being kept stable is a bright spot of the economy. This result comes from the high level of foreign exchange reserves and trade surplus over the years. With a stable exchange rate, Vietnam can avoid importing inflation from abroad.
The VND/USD exchange rate is quite stable for a long time
Besides, whether inflation story is good or bad will also depend on the government’s control of inflation. “If the government controls inflation well below 4% this year, I think it will be good for the whole economy,” Quang said.
The allocation of money to asset classes such as savings, buying gold, or investing in real estate or stocks, according to the expert, will also depend on macroeconomic conditions.
As in the period 2011-2012, when the Vietnamese currency was depreciated, inflation was over 20% and deposit interest rates were over 20%, real estate and securities were not good investment channels. The cash flow will then find a safe haven asset class such as gold, or savings.
At the current stage, the exchange rate is stable, inflation is under control and the economic growth is expected to recover. Securities and real estate are still two suitable investment channels.
Comparative results of inflation in 2011 and 2022
at Blogtuan.info – Source: cafebiz.vn – Read the original article here
