Dong posts biggest weekly advance since 2012 on dollar supply


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Dong posts biggest weekly advance since 2012 on dollar supply
Vietnam’s dong posted the biggest weekly advance in more than two years after foreign-exchange reserves rose to a record.
There’s a good supply of foreign currency as exporters sell dollars to banks instead of hoarding cash, the Tuoi Tre newspaper reported today. Reserve holdings climbed to an unprecedented $35 billion at the end of June, the central bank said on July 9.
The dong rose 0.4 percent to 21,200 per dollar this week, the most since the five days ended Feb. 17, 2012, according to prices from banks compiled by Bloomberg. The currency was little changed today. The central bank kept its daily reference rate unchanged at 21,246, according to its website. The currency is allowed to trade as much as 1 percent on either side of the fixing.
“Evidently, the State Bank of Vietnam’s stern emphasis on monitoring the foreign currency loan situation, concurrently flexible in terms of credit growth, as well as the high forex reserves have had a positive impact on the exchange rate,” Saigon Securities analysts including Phuong Hoang and Hung Pham wrote in a report today.
The five-year government bond yield climbed one basis point today and dropped four basis points this week to 7.01 percent, according to a daily fixing from banks compiled by Bloomberg.

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