Exchange rate is in chaos but still increases by 3.76%

Exchange rate is in chaos but still increases by 3.76%

In mid-September, the foreign exchange market witnessed a sharp increase in the USD/VND exchange rate. By September 20, the exchange rate suddenly changed its trend in the banking market but continued to increase in the free market.

Orient Commercial Joint Stock Bank (OCB) is the unit with the highest USD selling price in the system. However, on the morning of September 20, the USD/VND exchange rate at OCB was: 24,223 VND/USD - 24,693 VND/USD, unchanged from the end of yesterday.

However, compared to the end of 2022, the exchange rate at OCB increased by 878 VND/USD for buying, equivalent to 3.76% and increased by 693 VND/USD for selling, equivalent to 2.89%.

billionaire trend but still increasing 376 image 1 — On the morning of September 20, the USD/VND exchange rate suddenly changed its trend but still increased by 3.76% compared to the end of 2022. Illustrative photo

The remaining units, some places increase, some places decrease the USD/VND exchange rate.

Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank) listed the USD/VND exchange rate at 24,210 VND/USD - 24,550 VND/USD, up 5 VND/USD in both buying and selling directions.

Meanwhile, Vietnam Technological and Commercial Joint Stock Bank (Techcombank) went against the trend when it adjusted the USD/VND exchange rate down by 8 VND/USD in both directions to: 24,215 VND/USD – 24,555 VND/USD. Vietnam Export Import Commercial Joint Stock Bank (Eximbank) also adjusted the exchange rate down by 20 VND/USD to 24,210 VND/USD – 24,530 VND/USD.

At Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank), the exchange rate is listed at 24,207 VND/USD - 24,547 VND/USD, up 43 VND/USD for buying but down 37 VND/USD for selling.

In the free market, the exchange rate continued to rise significantly.

At Hang Bac and Ha Trung, the “foreign currency streets” of Hanoi, the USD/VND exchange rate is currently trading at: 24,300 VND/USD – 24,400 VND/USD, up 20 VND/USD in both buying and selling compared to the end of yesterday. At different stores, the difference is about 10 VND/USD.

Yuan to be Asia's worst performer in 2023

It can be seen that although the exchange rate is in a chaotic trend, the dong is still falling sharply compared to the USD. However, in the Asian market, the yuan is the worst performing currency.

Chinese state media said on Tuesday that downward pressure on the Chinese yuan against the US dollar was only temporary, noting that its value against the currencies of major trading partners was stable.

The comments from the official Economic Daily follow a number of other similar comments by authorities in recent months, both through state media and at press conferences, and come as the yuan faces continued weakness against the US currency.

The yuan has fallen more than 5% against the greenback so far this year and is one of the worst-performing Asian currencies in 2023. But against a basket of major currencies, the yuan has lost just 0.15% over the same period to 98.52 on Tuesday, according to Reuters calculations based on official data.

The widening yield differential with other major economies, especially the US, has put downward pressure on the yuan against the dollar.

“The yuan exchange rate still depends on long-term economic fundamentals,” the paper said in a commentary.

"Financial regulators will take action when necessary, resolutely regulate unilateral and pro-cyclical behaviors, handle activities that disrupt market order, and prevent exchange rate risks from exceeding the limit."

The People's Bank of China (PBOC) cut the amount of foreign exchange that financial institutions must hold in reserve last week, a move that the Economic Daily described as having a "positive effect" in stabilizing expectations about the currency and restoring market confidence.

“Based on the previous reduction in the foreign exchange reserve ratio (RRR), the cut could ease depreciation pressure, prevent excess risks and boost confidence in the short term,” the article said.

Source