NEWS 4TODAY-March 31 2008=====
" The US dollar has regained some ground "
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Rising dollar keeps exporters happy
(29-03-2008)
HA NOI — The US dollar has regained some ground against the Vietnamese dong over the past two days, easing some of the stress of the nation’s exporters.
The State Bank of Viet Nam yesterday listed the interbank exchange rate at 15,960, while Vietcombank yesterday listed dollar/dong buy/sell prices at a healthier 16,090/16,120.
The figures mark a sharp appreciation of 1.8 per cent of the dollar against the dong since Wednesday, when the central bank announced it would buy up dollar to support exporters.
It was also the first time this year that both buy and sell prices have peaked above VND16,000.
On the open market, gold shops yesterday were offering VND16,125 to VND16,135 against VND15,480 only ten days ago, an even more substantial four-per-cent appreciation of the dollar.
"Traders are coming back to the dollar," Nguyen Huu Dang, director of the business department of Ha Noi-based Bao Tin Minh Chau Jewelry Co, told Viet Nam News yesterday.
"The number of customers who came here today to buy dollar was much higher than the number who came in to sell. They believe the US dollar will move up even further over the next week."
The central bank has been buying up dollar from commercial banks at negotiated prices, and some commercial banks have bought US dollar on the market to sell to the State Bank.
The State Bank purchase then withdraws the excess dollar out of circulation, further increasing their value.
"Purchases between Vietcombank and the central bank have been carried out normally," said Nguyen Danh Luong, executive director of operations for Vietcombank. He refused to specify, however, the volume of US dollar in each purchase.
The State Bank’s director of Monetary Policy, Nguyen Ngoc Bao, attributed the dollar appreciation to the greenback’s strengthening against other world currencies, as well as growing imports.
In the first three months, import value reached US$20 billion, while exports netted $13 billion. The $7.3 billion trade deficit in the first quarter outstrips the pace set last year, when the trade deficit for the entire year was $12.4 billion.
The stronger dollar would benefit exporters, particularly exporters of agricultural products sold on highly narrow profit margins, so the strengthened US dollar would benefit farmers first, said Asia Commercial Bank deputy director Nguyen Thanh Toai.
Viet Nam Rubber Association general secretary Tran Thi Thuy Hoa said that commercial banks were more readily buying US dollar from rubber processing enterprises if they proved they had good export contracts.
Tran Van Gia, permanent vice chairman of the Viet Nam Tea Association’s Science Council, worried, however, that the appreciation of the dollar "would not last due to the US economic crisis. So the association has urged the Government to direct regulators to buy up dollar from our members." — VNS
