KTFA: Vietnam
Henig: Vietnamese đồng one of most stable currencies in Asia: Experts
May, 13/2023 – 09:51
The United Overseas Bank (UOB) rated the Việt Nam đồng as one of the most stable currencies in Asia, despite significant changes in the Fed’s interest rate hike expectations as well as concerns about a global recession and instability of the US banking system.
HÀ NỘI — Amid fluctuations in the global financial market, the exchange rate in Việt Nam has remained stable in the first four months of this year, and the Vietnamese đồng is considered one of the most stable currencies in Asia, according to experts.
Market analysis reports released by Mirae Asset Securities Vietnam showed that in April, the USD/VND exchange rate dropped 0.2 per cent and the average exchange rate hovered around VNĐ23,500 per US dollar during the month. The rate has remained stable throughout the January-April period.
The United Overseas Bank (UOB) rated the Vietnamese đồng as one of the most stable currencies in Asia, despite significant changes in the Fed’s interest rate hike expectations as well as concerns about a global recession and instability of the US banking system.
Mirae Asset noted that the State Bank of Vietnam had bought a large volume of foreign currency in the first four months, raising the foreign exchange reserves to around US$90 billion.
Đào Xuân Tuấn, head of the Foreign Exchange Management Department under the State Bank of Vietnam (SBV), said that since the end of 2022, the foreign exchange market has developed positively and gradually become stable.
The USD/VND exchange rate tends to decrease and stabilise again, he said, adding that the recovery of the Vietnamese currency against the US dollar since December 2022 was similar to that of many other currencies in the region such as the Japanese yen, Chinese yuan, the won of the Republic Korea and the Thai baht.
Tuấn said that the increase in foreign currency supply enabled the SBV to buy more foreign currencies for the foreign exchange reserves.
In the first four months of this year, the SBV bought nearly $4.9 billion from credit institutions, up about $1 billion from the amount recorded at the end of the first quarter of 2023.
Experts from VNDirect forecast that Việt Nam’s foreign exchange reserves will recover to reach $102 billion by the end of this year.
Meanwhile, Moody’s Investor Service has forecast that Việt Nam’s forex reserves excluding gold will rebound to $95 billion by the end of the year as the State Bank of Vietnam rebuilds its stockpile.
Nishad Majumdar, an analyst in Singapore, held that the recent appreciation of the đồng, which reflects the improved external position, will give the central bank space to rebuild the forex buffers that were spent down during the US dollar’s rally last year.
Việt Nam’s reserves stood at $88.3 billion in January, according to the International Monetary Fund.
Majumdar held that the recovery in tourism and steady foreign direct investment inflows will help boost the nation’s reserves even as exports weaken.
The đồng has advanced 6 per cent in the past six months, joining a rally in Asian peers, as the US dollar has weakened.
He recommended that Việt Nam prioritise exchange rate stability as a means to stabilise inflation and create certainty for inbound investors.
A stronger đồng reduces the local-currency value of the Government’s external debt, which still accounts for about a third of overall Government borrowing, he said.
It will also likely mitigate the impact of higher import and manufacturing input costs into domestic inflation, giving the authorities further space to pursue a more accommodative monetary policy, the expert added. — VNS LINK
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Henig: Banking sector’s digital transformation day to take place next week
09:05 | 13/05/2023
The digital transformation day of the banking sector will be held on May 18, the State Bank of Vietnam (SBV) announced at a press conference in Hanoi on May 11.
Hoang Thanh Nhan, Editor-in-chief of Thoi bao Ngan hang (Banking Times) newspaper, said the event aims to review outcomes achieved by the banking industry after two years of implementation of its digital transformation plan until 2025, with a vision for 2030.Hoang Thanh Nhan, Editor-in-chief of Thoi bao Ngan hang (Banking Times) newspaper, said the event aims to review outcomes achieved by the banking industry after two years of implementation of its digital transformation plan until 2025, with a vision for 2030.
It is expected to promote a national digital transformation programme and change the awareness of organisations and individuals about its role in the operation of the industry, she added.
Within the framework of the event, there will be a thematic conference on the application of population data in banking activities – the driving force for digital transformation – and an exhibition displaying outstanding services and products in digital transformation of banks and payment intermediaries.
Pham Anh Tuan, head of the Payment Department under the SBV, said that positive results have been recorded in digital transformation activities of the banking sector.
According to the Ministry of Information and Communications, in 2021, the State Bank of Vietnam ranked first in cyber security readiness and fourth in terms of digital transformation activities. Up to 95% of credit institutions have been carrying out digital transformation strategies at their units.
In the first three months of this year, non-cash payment transactions increased by 53.51% in quantity compared to the same period of last year while ATM transactions decreased by 2.37% in volume and 4.02% in value, reflecting a shift to electronic payment, Tuan said.
Source: VNA LINK
