State Bank of Vietnam Governor Nguyen Van Giau has predicted the country will finish the year with economic growth of 5 percent and inflation of 6-8 percent.

He has also suggested two possible scenarios for 2010. For the first, growth of 6-6.5 percent would be accompanied by inflation of less than 10 percent.

But it presupposes credit growth to be about 30 percent this year and 25-27 percent next year and crude oil prices to be 64 USD per barrel this year and 70-75 USD next year, he said.
The other possibility is economic growth of 6.2-7 percent and inflation of 7.5-8.5 percent.

This would be possible if credit growth is between 25-27 percent this year and by 23-25 percent next year and crude oil prices are at 60 USD and 70-75 USD.

Speaking about the central bank’s monetary policy, he said it plans to keep credit growth rate under 30 percent this year and gradually reduce it in the following years.

Giau said that though the Government has slackened monetary policy to combat the current recession, it still manages money supply tightly and would not devalue the VND.

The SBV would retain a flexible monetary policy, strengthening oversight of credit quality, and keep reasonable interest and exchange rates, he assured./.