The Vietnamese dong will not depreciate much against the US dollar in the second half of this year, so the whole year’s slide will be 3 per cent at the most, BVSC has forecast.
In another scenario, the depreciation rate of the dong will be only around 2 per cent this year, BVSC said, adding that the local currency has so far depreciated by 1.3 per cent against the dollar compared with the beginning of this year.
According to BVSC, the dong has been under pressure to devalue following sharp depreciations from other currencies in the Asian-Pacific region, such as Thailand’s baht (-3%), Indonesia’s rupiah (-7%), India’s rupee (-8%), South Korea’s won (-5.6%) and especially China’s yuan (-3.2%).
However, BVSC said that the dong would not slide sharply in the remaining months of the year as the Government’s top priority is to stabilise the macro-economy and minimise potential impacts from unexpected shocks.
The Government will intervene to prevent a sharp depreciation of the dong as such a decline could cause negative impacts on its policy to fight the dollar hoarding over the past three years, besides putting more pressure on inflation, BVSC analysts said.
In addition, the pressure of the dong devaluation will be reduced soon as the Chinese yuan is unlikely to depreciate further next time. Experts forecast that the Chinese government will intervene if the yuan continues being devalued. People’s Bank of China Governor Yi Gang on Tuesday said that China would keep the yuan stable and not deploy it as a weapon in the trade conflict with the US, helping the yuan reverse some of its recent plunge.
The dollar has appreciated recently against the dong, however, the market supply of the greenback on the domestic market has remained sufficient and adjusted to demand.
According to the State Bank of Việt Nam (SBV), though it has stepped in to steady the dollar-dong exchange rate by selling the greenback at the lower price of VND23,050 per dollar since Tuesday, it has not received any requests from commercial banks to purchase the foreign currency.
SBV on Thursday kept the daily reference exchange rate unchanged from the previous day at VND22,638 per dollar.
With the current trading band of +/-3 per cent, the ceiling rate applied to commercial banks during the day is VND23,317 and the floor rate VND21,959 per dollar.
The opening hour rates at commercial banks on Thursday went up. Vietcombank raised the rates by VND25 per dollar, listing the buying rate at VND22,020 and the selling rate at VND23,090.
The rates at BIDV were adjusted up VND5, standing at VND23,005 for buying and VND23,075 for selling.
Techcombank also added VND20 to both rates, buying the greenback at VND22,005 and selling at VND23,075.