Vietnam to let dong depreciate 1 pct vs dollar

Reuters

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Vietnam to let dong depreciate 1 pct vs dollar

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Vietnam will weaken its dong currency by 1 percent against the dollar from Wednesday on interbank transactions to help stabilise the foreign exchange market, the central bank said.
The mid-point for trading the dong will shift to 21,458 per dollar from 21,246, a level in place since last June, the State Bank of Vietnam said on its website (sbv.gov.vn) on Tuesday.
Dollar/dong transactions can move in a band of plus or minus 1 percent around the midpoint, which the central bank sets daily.
"The State Bank will guarantee to implement measures and policy instruments to stabilise the exchange rate and the foreign exchange market on the new price level," it said.
Prior to the central bank's statement, the dong dipped to 21,410/21,458 per dollar on the interbank market from 21,395/21,435 the previous day.
Last month Governor Nguyen Van Binh said the central bank would keep exchange rate adjustments within 2 percent this year. Last year the dong eased 1.3 percent against the dollar on the interbank market.
A weakening currency can provide a competitive edge for a country's exports.
The government has projected exports, the main driver of Vietnam's economy, to grow 10 percent to $165 billion this year, helping quicken economic growth to 6.2 percent from 5.98 percent in 2014.
On the unofficial markets the dong stood at 21,560/21,575 per dollar on Tuesday, having advanced marginally from 21,570/21,585 the previous day.

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