The State Bank of Vietnam (SBV) will manage the exchange rate flexibly, adjusting in line with general trends while still ensuring macro-economic stability and foreign currency balance, said its Permanent Deputy Governor Dao Minh Tu.
Current exchange rate fluctuations still fall within the controlled range of the State Bank of Vietnam, without necessitating usage of foreign exchange reserves for intervention, Nguyen Ba Hung, Chief Economist of the Asian Development Bank (ADB) in Vietnam, has said.
The State Bank of Vietnam (SBV) on April 23 took some moves like issuing treasury bills (T-bills), further employing T-bills as an open market operation (OMO), and stipulating liquidity and interest rates in the inter-bank market in the face of surging USD/VND exchange rates.
The price of SJC gold bars rose to nearly VND81 million (US$3,266) per tael (one tael is equivalent to 1.33 ounces) in the last trading session of the first quarter (March 30), up 8% from the outset of the quarter.
Vietnam still has effective tools to proactively control the VND/USD exchange rate in 2024 even if the US Federal Reserve (Fed) has to maintain its interest rates at the current high level for an extended time due to the conflict in the Red Sea and other new uncertainties, experts said.
Despite a challenging global economic landscape, Vietnam continues to stand resilient as one of the top 10 recipients of overseas remittances worldwide, with an estimated US$14 billion last year, according to the World Bank’s Migration and Development Brief and the Global Knowledge Partnership on Migration and Development (KNOMAD).
The State Bank of Vietnam (SBV) will continue to issue new bills to withdraw cash from the banking system as liquidity is abundant and interbank interest rates remain low, analysts forecast.
As the governance of the monetary policy has to concurrently guarantee multiple targets, including reducing interest rates, expanding credit, stabilising foreign exchange rates, and ensuring credit institutions’ safety, thorough consideration is needed before any steps are taken, Deputy Governor of the State Bank of Vietnam (SBV) Dao Minh Tu.
The foreign exchange rate has significantly fluctuated recently but experts forecast the rate in the remaining months of 2023 will not be under great pressure as in 2022.
Hanoi police have warned people against illegal foreign exchange trading platforms on the internet which have swindled many out of their money.