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Central bank says it won't devalue dong
Vietnam will not devalue the dong, said central bank Governor Nguyen Van Giau, who was repeating the official line at a time of intensified pressure on the currency.
Vietnamese authorities have been trying for weeks to dampen speculation of a devaluation of the dong, which is under pressure because of a shortage of dollars in the economy, partly due to Vietnamese hoarding the US currency.
“I can confirm that Vietnam will not devalue the currency, so hoarding dollars will have no benefit,” Sai Gon Giai Phong newspaper quotes Giau as saying.
The dong was devalued twice and its trading band widened four times in about a year to 5 percent from 0.75 percent when the economy was hit first by the world-wide spike in inflation and then the global financial crisis.
The central bank has reported that banks have plenty of dollars to lend, but few to sell.
In an effort to mobilize dollars, the central bank has put pressure on commercial banks to lower their dollar loan interest rates, while dong loan rates have risen.
The authorities have also renewed a campaign to limit the role of the dollar in the economy by cracking down on the use of dollars in domestic business, but it has had limited effect.
thanhnien, vietnamplus
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