SBV continues exchange rate flexibility to ease US currency concerns
Hanoi (VNA) – The State Bank of Vietnam (SBV) pledges
to continue fostering exchange rate flexibility while maintaining macroeconomic
and financial market stability, so as to ease concerns from the US Department
of Treasury about the country’s currency practices.
Together with its ongoing efforts to modernise monetary
policy and exchange rate framework, the SBV is committed to further flexibly
managing exchange rates in line with the state of development of the
foreign-exchange market and economic factors to ensure the proper functioning
of the market, thus promoting macroeconomic stability, according to the Vietnamese
central bank.
It held that Vietnam’s exchange rate policy, within
its general monetary policy framework, aims to stabilise the macro-economy and
control inflation, not to create an unfair competitive advantage in
international trade.
Vietnam had been under pressure from the US over its
currency practices after the Trump administration, in December last year, declared Vietnam a currency manipulator.
In April, the US Department of Treasury removed the label
of currency manipulator for Vietnam, saying it found insufficient evidence that
Vietnam was manipulating its currency. The department and the SBV have maintained regular discussions at both high and technical levels on monetary policy, exchange rate and
Vietnam’s forex market situation in the spirit of goodwill, cooperation and
mutual respect.
The SBV’s statement was made following the virtual
meeting between SBV Governor Nguyen Thi Hong and US Secretary of the Treasury
Janet L. Yellen on July 19, during which they highly spoke of
constructive coordination between the two sides.
They vowed to maintain close cooperation and goodwill to
address shared challenges, such as supporting a strong and inclusive recovery
from the COVID-19 pandemic./.