Illustrative image (Source:VNA)
Hanoi (VNA) - Commercial banks cut the exchange rate of the United States (US) dollar against the dong by 30 VND to 40 VND, bringing it to its lowest level in the past three months.

This was despite a rise in the central bank's daily reference rate on January 25.

Vietcombank and BIDV on January 25 listed the buying/selling rates between 22,320 VND and 22,390 VND per dollar, down 40 VND against the previous session.

Vietinbank also cut the buying rate by 20 VND to 22,330 VND and 40 VND for the selling rate to 22,405 VND.

The rates at ACB and Eximbank were quoted between 22,301 VND and 22,390 VND, a 40 VND reduction against the previous session.

The same trend was also seen in many other smaller-sized banks such as DongABank and Techcombank.

In contrast to the reduction at commercial banks, the daily reference rate quoted by the State Bank of Vietnam on January 25 rose by 2 VND to 21,910 VND.

The rates at the flea market were also much higher, staying between 22,490 VND and 22,510 VND per dollar.

From the beginning of this year, the central bank applied a new exchange rate policy in which it set a "central exchange rate" or a reference rate every day, instead of maintaining a fixed rate for a long period of time. The trading band of the new rate continues to be plus or minus three percent.

For the past few weeks after the new policy had been applied, the exchange rates quoted by commercial banks and the central bank have moved in the opposite direction.

By January 25, the US dollar/dong central rate stood at 21,910 VND per dollar, up 20 VND against the end of last year. However, the rate quoted at commercial banks in the period decreased roughly 130 VND per dollar against the end of 2015.

Director of the State Bank of Vietnam's Monetary Policy Department Bui Quoc Dung attributed the central rate rise to the impact of the global market including the devaluation of the yuan, a decline in the Chinese securities market and a rise in US dollar value.

As for the decline in the exchange rates of commercial banks, he said, it was thanks to a positive response from the market to the new exchange policy, which has helped reduce the dollar speculation in the domestic economy and encourage organisations and individuals to sell the greenback to commercial banks.

The move has contributed to creating good liquidation in commercial banks and the domestic forex market for the past weeks, he said.-VNA