Vietnam’s forex remains stable after FED’s interest rate increase

Hanoi (VNA) – The US Federal Reserve (FED)’s decision to raise interest rates by 0.25 percentage points on early December 17 has not prompted the State Bank of Vietnam to change its policy on stabilising foreign exchange rates, experts said.

Vietnam’s forex market saw almost no fluctuations after the FED decision and the prices of US dollar at commercial banks remained at the ceiling, they stated.

As of 8:20 am, Vietcombank quoted selling price of USD at 22,547 VND and buying price at 22,517 VND, the same rates as BIDV. Meanwhile, Eximbank kept its buying and selling rates steady at 22,497 VND- 22.547 VND per one USD.

The green notes have rebounded quickly and hit the ceiling since earlier this week. The commercials banks also raised the buying price after pegging the selling one to the ceiling in anticipation of the US central bank’s adjustment.

According to analysts, the domestic monetary market may be tense after the FED decision but it will remain stable with the determination of the central bank.

Exchange rates will not fluctuate much as investors have made necessary preparations for the FED’s interest rate hike, said Dr. Nguyen Duc Do, Deputy Director of the Academy of Finance’s Institute of Economics and Finance.

The State Bank has sufficient resources to stabilise the exchange rates, he noted.

The FED expanded interest rates for the first time in nearly a decade, signaling faith that the US economy had largely overcome the wounds of the 2007-2009 financial crisis. The FED expected that inflation rate for mid-term will rise to its target of 2 percent.-VNA