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SBV head vows to keep forex changes on hold

Update: June, 10/2014 - 08:54

HA NOI (VNS)  — The State Bank of Viet Nam Nguyen Van Binh made clear that he would keep the forex market stable till the year-end; if adjustment is a must, the margin would be within 2 per cent.

The policy-maker's commitment was delivered in a broadcast programme titled "Taxpayers ask, ministers answer" (Dan hoi, Bo truong tra loi) on Sunday by VTV, that was to response to recent public's expectation of a foreign exchange adjustment.

The expectation indicated through ‘remarkable changes' in selling/buying prices of US dollar on the parallel market and fluctuations of gold prices.

In the last two weeks, foreign exchange went through strong adjustments of up to VND40-60 per US dollar. Last Wednesday, banks pushed the exchange to VND21,246 per dollar, marking the highest price since last July.

Binh said that psychological factors somehow ruled the market, which was caused by tension in the resource-rich East Sea due to China's illegal placement of the Haiyang Shiyou-981 oil rig in Viet Nam's exclusive economic zone and continental shelf.

"In fact, deposits in foreign currencies keep sliding while those in Vietnamese dong are on the rise," Binh said. "Market supply and demand relations are balanced and secured."

Trade surplus recorded positive signals when it reached US$1.65 billion in May, and $2 billion in April.

The State Bank of Viet Nam added $10 billion in foreign reserves in the first months of the year, raising the total foreign reserves to $35 billion.

The country's foreign direct investment (FDI) registered in the first five months capital was $5.51 billion while disbursement was slightly inched up 0.4 per cent against the same period last year to $4.6 billion.

"Under this circumstance, we assume that factors leading to forex adjustment don't exist," Binh said.

Last week, the central bank's Head of Monetary Policy Nguyen Thi Hong said that the changes on the parallel market were almost caused by speculations and prices manipulation to take the most of herd mentality. — VNS


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