Vietnam's Central Bank Plans Dollar Sales to Stabilize Exchange Rate

Vietnam's Central Bank Steps In to Stabilize Exchange Rate

Vietnam's central bank is prepared to sell U.S. dollars in the market to ensure exchange rate stability, Governor Nguyen Thi Hong announced on Monday. The market has faced volatility following the U.S. Federal Reserve's rate cuts, and Hong emphasized the challenges in managing the situation.

Focus on Economic Stability and Growth

The central bank remains committed to maintaining stability and controlling inflation. However, Hong confirmed that measures will also be introduced to support the government’s goal of accelerating economic growth. The central bank is rolling out preferential loan packages aimed at low-income housing projects and the aquatic industry to boost development.

Managing Economic Growth and Credit Risks

While Vietnam’s economic growth has heavily relied on strong credit growth, the Governor noted that outstanding loans have now reached 120% of the country’s GDP. This high level of credit presents risks, and Hong warned against continuing to rely solely on easing measures. She stressed the need to encourage companies to raise funds through corporate bonds and stock markets as part of a more sustainable financial strategy.

Conclusion

Vietnam's central bank is taking proactive steps to stabilize the economy amidst global shifts. By controlling the exchange rate, supporting key industries, and promoting alternative funding methods, it aims to secure long-term economic growth.

For further reading, you can check out the following sources:

Vietnam Central Bank to Sell Dollars to Stabilize Exchange Rate
Vietnam’s Economic Strategy Amid Global Volatility
Credit Growth and Economic Risks in Vietnam