The State Bank of Vietnam (SBV) is committed to a consistent but flexible policy on foreign exchange management this year with a view to maintaining currency market stability and increases foreign currency reserves.
The central bank considered 2013 a successful year, as the two major goals of keeping exchange rates under control and increasing the foreign currency reserves had been achieved.
SBV Deputy Governor Nguyen Dong Tien says the bank recognises the importance of leaving enough management leeway to respond to any unforeseen market developments. Last year, this flexibility helped authorities quash damaging rumours and cool off the foreign currency market before pressures escaped control.
“Consistency reinforces market trust,” Tien says. “Fluctuations are only short term.”
He attributes the bank’s 2013 successes to its management of foreign currencies and gold, and the anti-dollarisation push.
The SBV Deputy Governor affirmed the central bank will continue its policy flexibility into 2014, hopefully reducing the economy’s dependence on dollars and gold and supporting export business growth.
Economic experts concur on the need for flexibility but warn that any adjustments must be made in a cautious manner to avoid big shocks to the economy.
SBV Foreign Currency Management Department Head Nguyen Quang Huy said the central bank faces three major currency market management challenges in 2014: an imbalance between demand and supply, market manipulation, and unpredictable investor psychology.
Therefore, many factors should be taken into account before any decision is made relating to foreign exchange rate, he said.-VNA
The central bank considered 2013 a successful year, as the two major goals of keeping exchange rates under control and increasing the foreign currency reserves had been achieved.
SBV Deputy Governor Nguyen Dong Tien says the bank recognises the importance of leaving enough management leeway to respond to any unforeseen market developments. Last year, this flexibility helped authorities quash damaging rumours and cool off the foreign currency market before pressures escaped control.
“Consistency reinforces market trust,” Tien says. “Fluctuations are only short term.”
He attributes the bank’s 2013 successes to its management of foreign currencies and gold, and the anti-dollarisation push.
The SBV Deputy Governor affirmed the central bank will continue its policy flexibility into 2014, hopefully reducing the economy’s dependence on dollars and gold and supporting export business growth.
Economic experts concur on the need for flexibility but warn that any adjustments must be made in a cautious manner to avoid big shocks to the economy.
SBV Foreign Currency Management Department Head Nguyen Quang Huy said the central bank faces three major currency market management challenges in 2014: an imbalance between demand and supply, market manipulation, and unpredictable investor psychology.
Therefore, many factors should be taken into account before any decision is made relating to foreign exchange rate, he said.-VNA
