The SBV is ready to actively use tools to ensure exchange rate stability

VCN - According to Standing Deputy Governor of the State Bank (SBV) Dao Minh Tu, monetary policy tools are needed to manage exchange rates, but communication elements are needed to create confidence in the market and avoid the psychology of hoarding. hold foreign currency.
SBV drafts regulations on a testing mechanism for Fintech SBV drafts regulations on a testing mechanism for Fintech
Credit package of VND120 trillion: must be disbursed as soon as conditions are met Credit package of VND120 trillion: must be disbursed as soon as conditions are met
SBV approves designation of 14 important banks in 2024 SBV approves designation of 14 important banks in 2024
Stabilizing exchange rates is very important for macroeconomic stability. Photo: ST
Stabilizing exchange rates is very important for macroeconomic stability. Photo: ST

According to a report from the General Statistics Office, in the first quarter of 2024, the USD price index increased by 3.97% over the same period last year.

However, recent exchange rate developments have always tended to increase, with many times reaching peaks. According to the money market report of SSI Securities Company, as of the end of March 2024, the interbank exchange rate was at VND 24,790/USD - equivalent to an increase of 2.15% compared to the end of 2023 and far from the historical peak of about 0.3%. Exchange rates at commercial banks and the free market are fluctuating in the historical peak area, currently around VND 25,200/USD.

According to SSI experts, data on trade balance or disbursed FDI in March were positive, but exchange rate movements were less positive because pressure on the international market was still very strong. Therefore, the State Bank may have to take stronger measures to cool down demand for USD.

Facing with the recent sharp increase in exchange rates, at the regular Government press conference in March 2024 on the afternoon of April 3, Standing Deputy Governor of the State Bank Dao Minh Tu affirmed that the exchange rate is indeed more exciting and exchange rate management in 2023 will have difficulties due to the impact of the world economy, while Vietnam is a highly open economy. By early 2024, the exchange rate will continue to heat up.

Therefore, the representative of the State Bank of Vietnam clearly stated that this is an issue that the State Bank needs to pay attention to and focus on operating.

Explaining the cause of the sharp increase in exchange rates, according to Deputy Governor Dao Minh Tu, there are many influencing factors but there are three basic reasons. Firstly, the US Federal Reserve (FED) has not yet given a specific date for loosening monetary policy to lower interest rates, so the value of the USD has increased, thereby affecting other currencies in the region, so it also affects the Vietnamese currency in its relationship with the USD.

Second, Vietnam's recent policy of lowering interest rates has created inadequacies by bringing the interest rate difference between VND and USD in the interbank market to negative levels, creating even more pressure to make the USD hotter.

Third, in the first three months of the year, the import situation was relatively positive, so the demand for foreign currency increased higher than in the previous period.

However, according to the State Bank, the depreciation rate of the USD compared to other currencies in the region is low. The representative of the State Bank of Vietnam informed that according to calculations, in 2023, VND will depreciate by 2.9%, currently on the interbank market, the VND to USD exchange rate is increasing by 2.6%. But the Chinese Yuan lost 1.74%, the Thai Baht lost 5.93%, the Korean Won lost 3.88%, the Japanese Yen lost 7.52%...

However, the Deputy Governor of the State Bank acknowledged that the exchange rate is one of the important indicators in macroeconomic management, because it not only affects the value of money and purchasing power but also many economic policies especially in terms of macroeconomic stability, inflation control, as well as stabilizing market psychology and investor confidence. Therefore, the State Bank always ensures to operate the foreign exchange market cautiously and flexibly, managing the exchange rate up and down in the general trend, ensuring stable purchasing power of the currency, maintaining a harmonious foreign exchange status. currency, ensuring foreign currency balance to meet legal foreign currency needs for businesses and import-export activities...

But Deputy Governor Dao Minh Tu also stated that to achieve the above goals, tools are needed. In addition to monetary policy tools, factors such as communication are also needed to create confidence in the market and avoid holding foreign currency.

“In fact, with the State Bank's foreign exchange reserves, in the last case necessary, it intervenes to ensure stability. Therefore, it is necessary to communicate so that businesses and people understand that the Government and the Prime Minister are always concerned and operate decisively, and that the State Bank is ready to use tools actively to ensure the goal of stabilizing exchange rates during this period. in the future", Deputy Governor of the State Bank Dao Minh Tu said.

Currently, many directions of the Government and the Prime Minister emphasize the task of stabilizing the foreign exchange market, thereby striving to continue to increase state foreign exchange reserves.

Hiện nhiều chỉ đạo của Chính phủ và Thủ tướng Chính phủ đều nhấn mạnh tới nhiệm vụ ổn định thị trường ngoại hối, từ đó phấn đấu tiếp tục tăng dự trữ ngoại hối nhà nước.

By HuongDiu/Quynhlan

Related News

Latest News

M&A activities show signs of recovery

M&A activities show signs of recovery

Mergers and acquisitions (M&A) activities in Vietnam have been showing signs of recovery in recent months as several large companies announced finished deals, which may create a ripple effect in the M&A market.
Fiscal policy needs to return to normal state in new period

Fiscal policy needs to return to normal state in new period

VCN - To recover the economy during and after the Covid-19 pandemic, fiscal policy has been flexibly and promptly managed, becoming a solid foundation to help businesses and the economy gradually overcome difficulties. After nearly 5 years, although there are still difficulties, the economy is gradually returning to a high growth trajectory. In that context, it is necessary to let fiscal policy return to normal state.
Ensuring national public debt safety in 2024

Ensuring national public debt safety in 2024

VCN - Since the beginning of the year, public debt management has been conducted proactively and effectively, meeting the need of raising capital for development investment. At the same time, debt indicators by the end of 2024 are guaranteed within the ceiling and safety threshold approved by the National Assembly, ensuring national financial security, increasing proactive response to risks arising from external and internal causes of the economy.
Removing many bottlenecks in regular spending to purchase assets and equipment

Removing many bottlenecks in regular spending to purchase assets and equipment

VCN - Decree No. 138/2024/ND-CP, which has just been issued, is expected to contribute to resolving bottlenecks in allocating funds for purchasing assets and equipment; renovating, upgrading, expanding, and constructing new construction items in projects that have been invested in and constructed in the past.

More News

Continue to handle cross-ownership in banks

Continue to handle cross-ownership in banks

VCN - The situation of excess share ownership, cross-ownership between credit institutions (CIs), CIs and enterprises, although has decreased significantly compared to previous periods, is still complicated and requires continued inspection and control.
Striving for average CPI not to exceed 4%

Striving for average CPI not to exceed 4%

VCN - According to the report of the Ministry of Finance, there are still some factors that put pressure on price levels in the remaining months of 2024, so the Ministry has updated 2 scenarios of average inflation in 2024 increasing in the range of 3.7-3.92%.
Delegating the power to the government to waive, lower, or manage late tax penalties is suitable

Delegating the power to the government to waive, lower, or manage late tax penalties is suitable

VCN - Discussing in groups about the project "1 law amending 7 laws" in the financial sector according to the program of the 8th Session on October 29, 2024, National Assembly delegates proposed that the Government should be assigned to make specific regulations on decentralization, granting the right to exempt and reduce taxes, and handling penalties for late payment of taxes...
Removing difficulties in public investment disbursement

Removing difficulties in public investment disbursement

VCN - According to the report of the Investment Department (Ministry of Finance), the estimated disbursement from the beginning of the year to October 31, 2024 is VND 355,616.1 billion, reaching 47.43% of the 2024 plan, reaching 52.29% of the plan assigned by the Prime Minister.
State-owned commercial banking sector performs optimistic growth, but more capital in need

State-owned commercial banking sector performs optimistic growth, but more capital in need

VCN - According to the report sent to the National Assembly before the 8th Session of the Government on investment, management and use of state capital in enterprises nationwide in 2023, the business performance of the state-owned commercial banking sector achieved positive growth.
Stipulate implementation of centralized bilateral payments of the State Treasury at banks

Stipulate implementation of centralized bilateral payments of the State Treasury at banks

VCN - The Ministry of Finance (MOF) gathers feedback on the draft Circular regulating the management and use of accounts of the State Treasury opened at the State Bank of Vietnam (SBV) and commercial banks.
Rush to finalize draft decree on public asset restructuring

Rush to finalize draft decree on public asset restructuring

VCN - According to the Ministry of Finance, the draft Decree regulating the rearrangement and handling of public assets is being urgently completed by the Ministry of Finance to submit to the Government for promulgation.
Inspection report on gold trading activities being complied: SBV

Inspection report on gold trading activities being complied: SBV

The State Bank of Vietnam (SBV) has announced that inspections on compliance with legal policies in gold trading activities of credit institutions and gold trading businesses have been completed and an inspection report is being compiled.
Budget revenue in 2024 is estimated to exceed the estimate by 10.1%

Budget revenue in 2024 is estimated to exceed the estimate by 10.1%

VCN -The Government estimates that state budget revenue in 2024 will exceed VND 172.3 trillion, up 10.1% over the estimate, of which tax and fee revenue will reach 13.1% of GDP.
Read More

Your care

Latest Most read
M&A activities show signs of recovery

M&A activities show signs of recovery

Mergers and acquisitions (M&A) activities in Vietnam have been showing signs of recovery in recent months as several large companies announced finished deals, which may create a ripple effect in the M&A market.
Fiscal policy needs to return to normal state in new period

Fiscal policy needs to return to normal state in new period

VCN - To recover the economy during and after the Covid-19 pandemic, fiscal policy has been flexibly and promptly managed, becoming a solid foundation to help businesses and the economy gradually overcome difficulties. After nearly 5 years, although there
Ensuring national public debt safety in 2024

Ensuring national public debt safety in 2024

VCN - Since the beginning of the year, public debt management has been conducted proactively and effectively, meeting the need of raising capital for development investment. At the same time, debt indicators by the end of 2024 are guaranteed within the ce
Removing many bottlenecks in regular spending to purchase assets and equipment

Removing many bottlenecks in regular spending to purchase assets and equipment

Decree No. 138/2024/ND-CP, which has just been issued, is expected to contribute to resolving bottlenecks in allocating funds for purchasing assets and equipment
Continue to handle cross-ownership in banks

Continue to handle cross-ownership in banks

VCN - The situation of excess share ownership, cross-ownership between credit institutions (CIs), CIs and enterprises, although has decreased significantly compared to previous periods, is still complicated and requires continued inspection and control.
Mobile Version