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Banks slashing US$ purchase prices
Commercial banks yesterday quoted dollar purchase and sale prices lower than the ceiling level allowed by the State Bank of Vietnam. The purchase prices fell to the deepest low in the last one month.
According to the State Bank of Vietnam, commercial banks quoted the purchase price at VND16,740/US$1 yesterday, August 4, the same level as late last week. However, in fact, big banks serving import and export companies slashed purchase prices considerably.
Vietcombank yesterday quoted the purchase price at VND16,700/US$1 and the sale price at VND16,760/US$1 with the gap between the purchase and sale prices becoming wider recently.
Sacombank offered a little higher purchase price at VND16,710/US$1 and sale price at VND16,760/US$1. Meanwhile, the purchase price was lower at Eximbank, at VND16,690/US$1, and Techcombank, VND16,600/US$1.
As such, the purchase prices applied by commercial banks have decreased by VND40-50/US$1 compared to last week. The quoted prices prove to be lower than the ceiling level (the ceiling level can be 2% higher or lower than the official exchange rate announced by the State Bank of Vietnam, which means that the rates could be between VND16,164/US$1 and VND16,824/US$1 on August 4).
It is clear that the foreign currency positions of commercial banks have improved. The latest report by the State Bank of Vietnam said that commercial banks do not have a demand to purchase dollars from the bank.
The profuse supplies of dollars and the stable demand and supply have prompted commercial banks to slash US$ deposit interest rates. Currently, the highest interest rate is 6.5% per annum, down by 2% from the highest peak seen in June.
The VND/US$ exchange rate also decreased slightly in the last week, according to the State Bank of Vietnam. The dollar was sold at VND16,750-16,770/US$1.
The dollar price decreases have been called good news for the foreign currency market. Since July, export companies which have earnings in foreign currencies have been selling dollars to banks. According to the Ministry of Industry and Trade, the trade gap has been narrowed with the trade deficit at $15.01bil, which makes the goal to curb the trade deficit at $20bil at maximum this year more feasible.
In the latest news, the State Bank of Vietnam has estimated that overseas remittance may reach $8bil this year (the figure was $3.5bil in the first half of the year), increasing by 60% compared to 2007. The overseas remittance always comes in big quantities in the last months of years, which helps improve the supply and helps stabilise the exchange rate.
VNN
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