The State Bank of Vietnam said that it is not planning any adjustments to the dong/dollar foreign exchange rate, but the central bank may soon provide a certain amount of US dollars to commercial banks to meet the demand for imports of essential goods, the local newswire VnExpress.Net reported on October 20.
The SBV did not specify the exact date and how much that it would be pumping money, but it confirmed it would soon deploy to meet the demand of essential imports.
"There is absolutely no ability to adjust rates in the short term," the SBV added.
Some commercial banks have made application for foreign currency supply and receive signals will be supported soon, with the condition that must have real needs of the business import of essential goods, and only meet applications for orders which mature in October.
While awaiting the official signals from this state management agency, the free forex market is still in a hot fever. A number of free foreign exchange shops yesterday afternoon offered for 20,150 dong/dollar (sell), up more than 100 dong compared with the opening morning, and the buckled 650 compared with the exchange rates in commercial banks. The purchase price of dollar was already beyond 20,000 to range from 20,030 to 20,100 dong/dollar.
In the interbank market, where banks to exchange foreign currency liquidity to offset each other, the psychological resistance of 20,000 has not yet been broken. However, the tension here is no less than the black market.
A manager of foreign currency department of a bank complained that the market is now stuck as the bank could not buy the dollars at the high prices, while customers cannot bear his bank's acquisition of high dollar prices. And the hot fever of dollars started to occur again, this bank had to call for help from the State Bank.
Most of the other banks are struggling to find ways to remove difficulties and to bridge the demand and supply to meet each other at an acceptable price. And this tolerance is also not less than that of the black market.
The recent dollar price rise is explained by the high increase of the need to purchase dollars for payments, while supply has not been improved. The situation is even more tense when export businesses that have revenue in dollars do not want to sell out or exchange.
However, experts say the forex market is in a too serious speculation. Speculators are often based on the difference between interest rates in dong and US dollars to predict the adjustment of the official exchange rate. From the beginning of this year, the State Bank has adjusted the exchange rate two times, with the rate of 5.6 percent. Meanwhile the US dollar interest rate is ranging from 7 to 8 percent higher than the interest rate of dong. According to this conventional thinking, if any change, the official exchange rate adjustment cannot exceed 3 percent. And in that case, the bank rate will not exceed 20,000 dong per dollar.
"The dollar/dong exchange rate in excess of 20,000 now is too much. If we had a foreign currency source at the moment, we are happy to sell 19,800 to 19,850 dong," Chair of Doji Jewellery Company Do Minh Phu said. Gold enterprises often earn more foreign currency balance when they export gold or jewellery. However, the first half of Oct, due to higher domestic prices than the world, gold export activities are disrupted.
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