Efforts to stabilize exchange rates

Businesses want a stable exchange rate to "breathe easier" as the busiest business season of the year approaches.

Over the past month, the USD price in the domestic market has fluctuated strongly, causing many people to worry that it may affect production and business activities at the end of the year.

Great pressure for business

Statistics show that last August, the USD exchange rate at Vietcombank increased by 142 VND for buying and 122 VND for selling compared to the end of July, while at BIDV , the increase was 176 VND and 135 VND respectively. In the free market, the fluctuation was even more obvious, when the price increased by about 140 VND/USD, closing at 26,650 - 26,720 VND/USD. Since the beginning of the year, both the central exchange rate and the commercial exchange rate have increased by about 3.68%, a significant increase compared to the previous period.

According to businesses, exchange rate fluctuations have quickly affected production and business activities, especially for businesses that are importing raw materials to prepare for the peak season at the end of the year. Mr. Vo Thanh Loc, Commercial Director of Farmers Market store system (HCMC), said that in recent days he has been very impatient to see the exchange rate "heat up" right in the peak season of importing Tet goods. However, he said that the business still maintains the expected import volume. When the goods arrive at the port, the final retail price will be calculated by the business based on actual costs and the general market level. "However, the Tet market is very competitive, we cannot see the exchange rate increase and immediately increase the selling price accordingly, but we also have to consider the general price level and the purchasing power of consumers" - Mr. Loc said.

Imported goods area at MM Mega Market An Phu supermarket, Ho Chi Minh City. Photo: AN AN

According to Mr. Loc, in the retail industry, finding good sources of goods with production advantages and low prices is the deciding factor in consumption, while exchange rates are only part of the overall problem.

Mr. Bach Khanh Nhut, Permanent Vice President of the Vietnam Cashew Association (Vinacas), said that the cashew industry both imports raw materials and exports cashew nuts, so at first glance it seems balanced when the exchange rate fluctuates. But the reality is different, because most businesses do not have USD available and have to buy on the free market to import and pay debts. With the current exchange rate, import costs are much higher than expected, causing difficulties for cashew businesses. "While cashew nut exports are slowing down, many businesses cannot sell their products because the US and European markets are almost frozen, customers are only buying sparingly, waiting to see how the world economy is doing and have not expanded their order signing," said Mr. Nhut.

According to Mr. Nhut, businesses are currently mainly relying on the Chinese market to serve the Mid-Autumn Festival, while still anxiously waiting for October, the time expected to be more vibrant when entering the peak shopping season at the end of the year. "Not only the cashew industry, other businesses also hope for a stable exchange rate for easy calculation. Currently, the business problem only revolves around balancing the cost price - selling price, it is very difficult to outline a long-term plan" - Mr. Nhut shared.

Proactive intervention strategy

Notably, the USD exchange rate in Vietnam has been continuously climbing despite the greenback's cooling trend in the international market. Since the beginning of the year, the USD index (DXY) has decreased by about 11%, but in Vietnam, the currency has still increased in value compared to VND. Experts say that this reversal is partly due to the increased demand for foreign currency to import goods by businesses when global trade is volatile.

Speaking to reporters of the Lao Dong Newspaper on the afternoon of September 1, Associate Professor Dr. Nguyen Huu Huan (Ho Chi Minh City University of Economics - UEH) commented that the monetary policy being maintained by the State Bank of Vietnam (SBV) is in the direction of loosening to keep interest rates low to support economic growth. "In that context, the USD/VND exchange rate is unlikely to avoid pressure to increase in price and may continue to fluctuate from now until the end of the year. The important thing is that businesses need to calculate carefully, avoiding the situation of increasing the selling price of goods immediately when import costs increase due to the exchange rate rising. Instead, they can take advantage of appropriate financial risk prevention tools to reduce negative impacts," Mr. Huan recommended.

From another perspective, Mr. Vu Minh Duc, trade representative of the California Raisin Association (USA) in Vietnam, said that it is necessary to look at the exchange rate in relation to other key currencies. "It is true that the USD has increased in value in Vietnam, but in many other markets, the USD has decreased compared to the euro or the pound. Therefore, Vietnamese enterprises importing goods in USD are still more profitable than when transacting in other currencies," Mr. Duc analyzed.

However, in the past week, the USD/VND exchange rate has shown signs of cooling down. This is considered a positive signal, indicating that the pressure on the exchange rate may ease in the final period of 2025. Mr. Nguyen Thanh Lam, Director of Analysis for Individual Clients - Maybank Securities Company, said that there was a time when the exchange rate in the market exceeded the mark of 26,500 VND/USD. Immediately, the State Bank of Vietnam showed its initiative in stabilizing the market with timely solutions, such as: announcing the sale of USD through a 180-day term contract that can be canceled, at 26,550 VND/USD, higher than the market exchange rate at that time (26,512 VND/USD). "This intervention is limited to banks with negative foreign exchange positions, with an allocation sufficient to balance the position. Thereby, it helps reduce short-term exchange rate pressure while still preserving foreign exchange reserves. This is a very proactive intervention strategy, both stabilizing market sentiment and limiting speculation and creating room for Vietnam to flexibly respond to global fluctuations," Mr. Lam emphasized.

From another perspective, experts from MBS Securities Company noted that although the USD is forecast to continue to decline towards the end of the year when the US Federal Reserve (FED) may begin to lower interest rates, internal pressure on the exchange rate remains. One of the reasons is that the demand for imported goods from the US has increased sharply when the 0% tax rate begins to take effect, while exports may slow down, narrowing the trade surplus. In addition, the gap between domestic and international gold prices is increasingly widening in the context of rising international gold prices, invisibly stimulating the need to collect foreign currency on the free market to smuggle gold.

Credit forecast to increase sharply

Mr. Dinh Duc Quang, Director of UOB Vietnam's Currency Trading Division, said that in the short term, the SBV has not made any moves to adjust the VND policy interest rate. However, if the FED lowers interest rates in September and the downward trend in USD interest rates becomes clearer from the end of 2025 to the beginning of 2026, the SBV may reduce VND interest rates by about 0.5 percentage points. At that time, the USD is forecast to cool down to around VND26,000/USD by the end of the year, meaning the exchange rate will only increase by about 2%-3% throughout the year.

According to Mr. Quang, it is difficult for deposit and lending interest rates to decrease deeply due to capital pressure, but credit can accelerate, with the annual growth rate reaching 18%-20%. This will be an important boost, supporting businesses to access capital and contributing to promoting economic growth in the final stage of the year.

Source: https://nld.com.vn/no-luc-giu-on-dinh-ti-gia-196250901200949389.htm