BizLIVE - The Vietnamese central bank has continued buying in foreign currency to create larger buffers for monetary shocks.
Vietnam Central Bank Lowers U.S. Dollar Buying Cost as FX Reserves Hit Fresh Record
Vietnam's forex reserves have surpassed $43 billion. Photo: Internet
The State Bank of Vietnam (SBV), the country’s central bank, has reduced its buying price for the U.S. dollar, indicating a different approach, as the foreign exchange reserves have reached a new high.
The buying price for the greenback at the bank’s head transactions office on October 10 was quoted at 22,720 dong a U.S. dollar, down 5 dong from the fixing in place since end-June and 20 dong below the upper limit of 23,121 dong.
This is the first time the central bank has made such a move since it initiated a new fixing mechanism for the USD/VND rate in January 2016.
Since the start of this year, the bank had raised the buying price three times, in January, April and June.
With mild fluctuations in the money market, the Vietnamese central bank has been buying in foreign currency, bringing its forex reserve fund to over $43 billion currently, according to VnEconomy.
Meanwhile, the bank continues to keep its selling price of the U.S. dollar 20 dong below the ceiling, indicating that it is ready to intervene in the market and keep the USD/VND steady throughout the end of this year.