U.S. Treasury continues to affirm Vietnam does not manipulate currency

The State Bank has operated a proactive and flexible monetary policy.

The U.S. Treasury recently released its semiannual report on "Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States."

The report evaluates the policies of major trading partners that collectively account for approximately 78% of the United States' international trade over the past four quarters, ending in June 2024.

The Treasury Department uses three key criteria to determine whether major trading partners are manipulating their currency: Bilateral Trade Surplus with the U.S. not exceeding $15 billion; current account surplus not exceeding 3% of the country's GDP.

Persistent, One-Sided Foreign Exchange Market Intervention, measured by net foreign currency purchases by the central bank over a 12-month period.

A country meeting at least two of these thresholds is placed on the Treasury's "monitoring list" and remains there for at least two subsequent reporting periods.

The latest report concludes that no trading partners have engaged in exchange rate interventions aimed at impacting balance of payments or gaining an unfair competitive advantage in international trade.

Vietnam, along with seven other economies—including China, Japan, South Korea, Taiwan (China), Singapore, and Germany—remains on the "monitoring list" for exceeding two thresholds: bilateral trade surplus and current account surplus.

Previously, in the Joint Statement on the elevation of U.S.-Vietnam relations to a Comprehensive Strategic Partnership, the U.S. praised Vietnam’s ongoing efforts to modernize and enhance the transparency of its monetary and exchange rate policies.

Building on this strategic partnership, the State Bank of Vietnam has committed to collaborating closely with relevant ministries and agencies to maintain strong cooperation and establish effective, regular communication channels with the U.S. Treasury.

These efforts aim to foster mutual understanding, facilitate information sharing, and promptly address issues of shared interest.