Business · Vietnam Bureau
Vietnam dong weakens as reference rate drops 5 VND against US dollar
Vietnam's reference exchange rate declined 5 VND against the US dollar on October 21, continuing recent volatility in the currency markets. The dong's movement reflects broader regional currency pressures amid shifting global economic conditions.
LSN Vietnam ·
The State Bank of Vietnam set the reference exchange rate at a lower level on October 21, marking the third significant adjustment within a week as the national currency faced continued depreciation pressure.
Under the current trading band framework permitting fluctuations of ±5 percent, commercial banks operated within defined parameters on the day. The ceiling rate applicable to banks stood at 26,916 VND per US dollar, while the floor rate was established at 24,352 VND per US dollar.
The recent movements underscore ongoing volatility in Vietnam's foreign exchange market. After increasing 6 VND on October 20, the reference rate had declined 4 VND at the week's beginning on October 16, followed by a 5 VND drop that same day. These fluctuations suggest the dong remains sensitive to external economic factors and capital flow dynamics.
Market participants remain attentive to State Bank guidance as the central bank seeks to balance currency stability with broader economic objectives. The trading band mechanism continues to provide a structured framework for managing daily exchange rate movements while maintaining market confidence in the currency.
Photo: The State Bank of Vietnam's Ho Chi Minh City branch building, August 2019. Simon_sees via Wikimedia Commons (CC BY 2.0).