Central bank satisfied with efforts so far and will leave rate as it is.
The State Bank of Vietnam (SBV) has confirmed it will not adjust the exchange rate any further and will take all measures to stabilize the rate and the foreign exchange market between now the opening months of 2016.
Deputy Governor Nguyen Thi Hong said that the last adjustment was sufficient and the central bank has anticipated other fluctuations even if the Chinese Renminbi is devalued again or if the Federal Fund Rate increases. It was a proactive measure, giving the VND a competitive advantage and enough flexibility to respond to changes in the market.
Ms. Hong added that fluctuations in the exchange rate have been mainly due to psychology and also rumor, with many seizing the chance to speculate and profit.
On August 19 the SBV increased the exchange rate by 1 per cent and loosened the trading band from +-2 per cent to +-3 per cent.
On the afternoon of August 24 the exchange rate rose to its ceiling of VND22,547 per USD. The purchase price at banks was almost the same as the sales price, at just over VND22,500. In the free market, the rate early in the afternoon of August 24 was VND22,700 but then rose to a record VND22,830.