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Thursday, June 13, 2024

SBV to sell foreign currency to stabilize exchange rate

The Saigon Times

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HCMC – The State Bank of Vietnam (SBV) has announced its intention to sell U.S. dollars at VND24,450 in a bid to stabilize the exchange rate, according to SBV Deputy Governor Dao Minh Tu during a press conference today.

Tu said that the central bank stands ready to intervene “as early as today” using the 2023 supplemented foreign exchange reserves if the exchange rate continues to be unfavorable.

He was speaking at a news briefing on the banking sector’s quarterly performance on April 19.

He said the global economic and geopolitical volatility contributed to a 4.9% depreciation of the Vietnamese dong against the U.S. dollar since early this year.

Given Vietnam’s susceptibility to fluctuations in the U.S. dollar due to its import-export dynamics, Tu stressed the importance of implementing flexible yet stable exchange rate management strategies to mitigate market impacts.

The SBV had increased money supply while implementing stronger measures, said Pham Chi Quang, head of the SBV’s Monetary Policy Department.

Quang outlined the SBV’s intervention plan, which involves selling foreign currency to banks with negative foreign currency balances at a rate of VND25,450 per dollar.

“This is a strong measure by the central bank to alleviate market concerns, ensure market liquidity, and meet the legitimate demand for foreign currency in the economy,” Quang added.

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