Enterprises in Vietnam have returned to borrow U.S. dollars over the last two months as a result of slight fluctuations in the foreign exchange rate between the dong and the greenback.
The move has caused total dollar outstanding loans at commercial banks to rise 1.2% in July against June.
The central bank said it will stabilize USD/VND exchange rate stable, reassuring businesses to get more dollar loans from banks, said director of a HCM City-based commercial bank.
The State Bank of Vietnam, the country’s central bank, has signed a deal with the Industry and Trade Ministry to tighten control over forex transactions as dollar rates were rising on the unofficial markets due to a forecast that annual exports will fall this year.
The director added that compared to other currencies, the U.S. dollar was still the most stable currency due to the central bank’s strict supervision.
Dollar loans were modest during the first six months of this year as businesses fear that a forex shortage will make it difficult to pay the dollars back later.
The ceiling for dollar lending rates has been 3% per year since June 1 after commercial banks agreed with the central bank to reduce their rates to the figure in late-May in a bid to stabilize the foreign currency market.
The Vietnamese dong was at VND18,370-VND18,400 against the dollar as of 4:40 p.m. on August 27 in Hanoi. (CafeF)
Vietnamese
