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Greenback price broke VND 17,000/US $1.00 threshold
The greenback price on the black market yesterday unexpectedly increased, once hitting VND 17,150/US $1.00, though commercial banks’ quoted VND/US$ exchange rates were unchanged over the previous days at VND16,842-16,843/US $1.00.
The surge of the greenback on the black market was considered the response to the package of measures announced by the State Bank of Vietnam on November 3.
At the currency exchange shops on Ha Trung Street, the big foreign currency market of Hanoi, the yesterday’s VND/US$ exchange rate hovered around VND 17,050-17,100/US $1.00 (purchase and sale) in the afternoon, an increase of VND 100/US $1.00 more than the day before.
Prior to that, in the morning, the sale price once hit VND 17,150/US $1.00, while the purchase price was VND 17,100/US $1.00. The sale prices would be lower for those who purchased more than US $10,000.
The owner of a shop was seen yesterday afternoon talking to a client who said he wanted to sell US dollars and that the client should wait and sell their dollars later, because the US dollar price is believed to go up further.
“You should keep close watch over the election in the US to make decisions whether to sell the US dollar,” he said.
In fact, many shop owners did not have enough US dollars to meet clients’ demand. The owner of a shop told his clients to come back the next morning when he will sell several thousands dollars, while he had only several hundreds dollars at that time.
The sale prices quoted by commercial banks yesterday were at VND 16,842-16.843/US $1.00. Meanwhile, the interbank exchange rate announced by the State Bank of Vietnam was VND 16,512/US $1.00, a slight increase of VND 2/US $1.00 over yesterday.
Analysts said that the greenback price increase should be seen as the market’s reaction to the package of measures announced by the State Bank of Vietnam.
On November 3, the central bank decided to slash the basic interest rate to 12%, while announcing measures to support banks’ liquidity. In theory, when the foreign currency supply and demand stabilize and the VND interest rates go down, the dollar price will go up.
However, the analysts have denied the influence of the US election on VND/US$ exchange rate, while saying that speculation may partially caused the dollar price increase.
They also said that the dollar price increases not because of the high demand from foreign investors to purchase dollars to transfer abroad. The foreign investors have been made to believe that they should sell their stakes out amid the US financial crisis to get back money to be transferred home.
However, the analysts said that there have been signs showing that the foreign investors’ massive sales have stopped. By the end of October, foreign investors had sold the bonds worth US $800 million and stocks worth US $100 million.
The foreign currency once also witnessed the ‘fever’ on October 20, after the State bank of Vietnam released the decisions understood as the measures to gradually loosen the monetary policies. The dollar price also broke the VND 17,000/US $1.00 on October 24 before decreasing after a few days.
Vietnamnet
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