(VOV) – The State Bank of Vietnam (SBV) has said it will keep a close watch on the forex market and make a timely intervention if necessary to stabilise the market.
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Forex market still in check
Immediately the exchange rate fluctuated sharply in the market. At the Vietnam Export Import Commercial Joint Stock Bank (Eximbank), a US dollar was exchanged on June 9 for VND21,240, close to the VND21,246/US$ ceiling level announced by the SBV, up VND20 compared to late last week.
The rate at the Bank for Foreign Trade of Vietnam (Vietcombank) was VND21,240/US$, up VND20 against last week.
Financial expert Tran Hoang Ngan attributed the market fluctuations to residents’ psychological worries over recent East Sea tensions following China’s illegal oil rig placement in Vietnam’s territorial waters rather than market demands.
In the first five months of this year, Vietnam enjoyed a US$1.6 billion trade surplus while its foreign currency reserves kept increasing.
“That’s why the central bank did not adjust the rate, and if the exchange rate rises, it [fluctuation] does not last long,” Ngan predicted.
Market speculations under the microscope
Regarding the rate fluctuations, SBV deputy governor Nguyen Phuoc Thanh did not rule out the possibility that several commercial banks upped the rate to anticipate the central bank’s upcoming move.
However, the central bank did not intervene in the market as the new rates are within the limits and have not caused any chaos, he said.
Nguyen Chi Hieu, another financial expert, noted that besides the psychological factors, market speculation is another reason for the recent fluctuations in the exchange rate.
Several banks hesitate to sell US dollars for fear that East Sea tensions could negatively the national economy that eventually fuels foreign currency demands.
Yet, Hieu echoed Thanh’s view that the rise in the exchange rate is within the SBV margin range.
Head of the SBV’s Monetary Policy Department Nguyen Thi Hong said the central bank will closely monitor market developments to flexibly address arising issues to stabilise monetary, foreign currency and gold markets.
With its large reserves, the SBV is capable of intervening in the market if there are any sharp fluctuations, in order to keep the exchange rate stable, she said.
She went on to say the SBV and relevant ministries and agencies will intensify foreign currency management measures, timely detect and punish market law violations.
A representative from Hong Kong and Shanghai Banking Corporation (HSBC) said the SBV is powerful enough to step in to stabilise forex market if necessary.
The central bank plans to adjust the exchange rate within the 1-2% margin this year, and HSBC is confident that the range will be kept until the end of this year, he said.
Economic experts also suggested that the central bank keep its eye on fluctuations in the gold market in order to stabilise the forex market. An increasing demand for foreign currencies to import gold will cause the forex market to overheat.
Furthermore, the SBV should focus on policies aimed at filling the gap between domestic and foreign gold prices, they said.
Đăng ký: VietNam News