Third time this year
After China devalued its renminbi and announced a new rate fixing system last week, Vietnam said on Wednesday it had devalued its dong currency by 1.0 percent, setting its reference rate at 21,890 dong per US dollar. It also widened the trading band to 3.0 percent on either side of that rate.
Vietnam hopes the moves will help keep its thriving export trade — including smartphones and other electronics manufactured by Korean giant Samsung in its Vietnamese factories — competitive with regional rivals.
The dong has weakened by 3.2 percent so far this year.
From Bangkok, a report by The Nation quoted the Vietnam central bank as saying in a statement: After the strong depreciation of the yuan, the domestic market sentiment is still largely concerned about the impact of the imminent American Federal Reserve’s rate increase.”
It said these adjustments were aimed at proactively leading the market and pre-empting any negative impact of a possible Fed Reserve rate increase.
Commercial banks promptly responded to the central bank’s decision and put up new rates this morning, the newspaper said.
The rest of the report said: “Eximbank, BIDV and Asia Commercial Bank posted the highest selling rate of 22,480 dong per dollar, it said.
”Vietinbank, the country’s largest lender in terms of asset value, estimated at $30.9 billion, quoted the ceiling rate at VND22,450, while Vietcombank was selling the dollar for VND22,400.
”Sacombank quoted the lowest rate at VND22,360 per dollar at 8.47am.”