According to the latest news from Federal , In June this year, the Fed will continue to raise interest rates in . It is reported that the basis point for the interest rate hike is 50, and the probability of interest rate hike is as high as 97.5%. and in July thereafter, there will be a total rate hike of 100 basis points, with the probability of rate hike as high as 96.1%. The Federal Reserve has raised interest rates several times before, so Vietnam has withdrawn 396 trillion yuan of funds.
Many foreign media said that Vietnam is likely to have a 20-year economic regression due to this. What's going on?
1. Vietnam's situation
Since 2020, the Vietnamese stock market has been regarded as the best in the world by the industry, and it has doubled in 2021. This is particularly rare in the context of the arrival of the epidemic, and many people have felt the impact of the stock market. However, the good times did not last long. After the Vietnamese stock market ushered in two consecutive years of highlights, it began to go downhill.
Vietnam stock market has fluctuated recently. On the 23rd of this month, the Vietnam VN30 index began to fall from its highest point this year. According to relevant persons, the decline in relevant data has reached 23.1% before the day. , especially on May 22, the large-scale sale caused the Vietnam stock market to usher in the worst environment in the past two years.
Relevant experts said that this is likely not the worst moment of this year, and the Vietnamese stock market will usher in a more difficult time after that. Especially as Vietnam is constantly rectifying the financial market, it is likely that the market will be dominated by downside risks for a long time. , and Vietnam has also become the first market to be hit by the Federal Reserve's continuous interest rate hikes.
The stock market is actually a place where investors gather. As we all know, any turmoil will affect the performance of the stock market. Such an impact exists both individuals and countries, so because of the previous fluctuations in Vietnam, many people who are good at investing have begun to withdraw from the Vietnamese market. It is reported that as of May 20 this year, the funds evacuated by foreign investors from Vietnam have reached 396 trillion yuan.
This means that the Vietnamese stock market has lost 396 trillion Vietnamese Dong securities and financial assets. The losses such as are basically 2.8 times that of the same time last year . Moreover, the chain reaction caused will still cause Vietnam's stock market to continue to fluctuate, so it has become a consensus among people. In addition, because of the performance, risk aversion has become a hurdle.
The current global situation is not clear, and the price of commodity is still at a high end. So all countries need to go through it steadily, and risk aversion is spreading around the world, resulting in the Vietnamese stock market being gradually declining.
Moreover, although Vietnam's foreign exchange reserves continue to increase, its own foreign debt has increased significantly. Some experts even said that by the end of this year, the proportion of foreign debt in will be close to 67% of its GDP, , and this proportion is also the upper limit of debt ratio stipulated by the Vietnamese government.
Moreover, Vietnam's inflation is very serious now, and the international situation is not conducive to its short-term solution to inflation problems. Therefore, some experts said that after Vietnam suffered this financial blow, it is very likely that the economy will be regressed for 20 years.
. Vietnam's experience has a direct relationship with the Federal Reserve, and it also sounded for eight countries: Turkey , Argentina , Sri Lanka , Indonesia , Brazil , Poland , Egypt , and Lebanon. Alarm bell. So what exactly did the Fed do?
2. Fed's actions
. What is the most common thing the Fed has done this year? Many people may subconsciously think of two words "rate hike". In fact, the purpose of the US interest rate hike is to maintain the US dollar's position in global trade and at the same time attract a large number of regions to be optimistic about the US dollar. After the United States announced that it would raise interest rates in the most radical way in recent decades, there was serious turmoil in the U.S. stock market.
At the same time, the Federal Reserve announced that it would continue to raise interest rates, which would also increase the cost of US dollar lending in the global market. Although it has laid risks for the future development of the United States to a certain extent, , the purpose of the United States is to transfer its own risk of to other countries, minimizes its own impact, thereby obtaining absolute discourse right.
At present, it has become an unstoppable thing for the United States to harvest wealth from Vietnam. Because Vietnam is actually a market with a relatively single economic structure, high foreign debt and shortage of foreign reserves. In the face of such a market, the United States can transfer risks through increasing debt and inflation risks.
For many years, the United States has actually transferred its own crisis to the outside world, thereby harvesting wealth around the world. The reason why the United States can do this is because of the dominance of the US dollar in the world's financial system. This is also why many countries have been de-dollarizing for a long time, in order to reduce the impact of the US dollar on itself.
Conclusion
Vietnam’s experience sounded a wake-up call for us. The financial means the United States has previously taken in the world have caused the reputation of the US dollar to plummet. At this time, the most important thing for each country is to make strategic positioning, that is, how to minimize the influence of the US dollar on its own country. What do readers think about this? Welcome to like and leave a message!
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