Deputy Governor of the State Bank of Vietnam: Businesses can rest assured about the exchange rate; interest rates may also fall further.

ANTD.VN - Deputy Governor of the State Bank of Vietnam, Dao Minh Tu, affirmed that the State Bank of Vietnam will manage the exchange rate stably, preventing the hoarding of foreign currency, and will strive to further reduce interest rates, not ruling out a further reduction in the policy interest rate.

According to Deputy Governor of the State Bank of Vietnam (SBV) Dao Minh Tu, the SBV remains committed to ensuring macroeconomic stability and exchange rate stability.

Currently, gold and USD prices are rising in line with global prices, and market supply and demand fluctuate at certain times. However, the Deputy Governor affirmed that the exchange rate will be managed to remain stable.

"Businesses can rest assured about the exchange rate. Currently, the exchange rate is fluctuating within the permitted range, and we affirm that we will manage it to prevent the hoarding of foreign currency in anticipation of a rise in the exchange rate. Currently, abundant foreign exchange reserves, continued growth in FDI inflows, and positive developments in other foreign currency sources… are the basis for stabilizing the exchange rate," the Deputy Governor said.

Despite some concerns about the volatile exchange rate, according to the State Bank of Vietnam's leadership, the market must accept fluctuations. "If it were rigid, it would no longer be a market economy. There can be no immutability in the exchange rate," Mr. Tú said.

Phó Thống đốc Ngân hàng Nhà nước Đào Minh Tú ảnh 1

Deputy Governor of the State Bank of Vietnam, Dao Minh Tu

Regarding interest rates, the Deputy Governor stated that since the beginning of the year, liquidity has been abundant, banks have excess capital, and a significant amount of capital is held by banks. The State Bank of Vietnam has also implemented many solutions to alleviate difficulties for struggling businesses, such as lowering the policy interest rate, thereby reducing the cost of capital for commercial banks and enabling them to lower interest rates for businesses.

Businesses that are struggling and unable to repay their debts are given extensions and deferrals, helping them to weather the storm.

However, the Deputy Governor acknowledged that some business loans are still subject to high interest rates, but these are mainly old loans.

Although commercial banks have the right to determine lending interest rates, the State Bank of Vietnam's leadership also reminded banks to manage interest rates in line with the general market level, as this is a mandatory requirement for banks to compete with each other.

"Commercial banks must do their calculations; they cannot stubbornly maintain high interest rates because 'no one will play' in a market that is increasingly open and transparent regarding prices and interest rates," said a leader of the State Bank of Vietnam.

“The country has hundreds of large and small banks, not to mention consumer finance companies, people's credit funds… There’s no reason why businesses should be dependent on a single bank. If a bank is in difficulty, it can absolutely switch to another bank. This is the borrower’s right to choose according to market mechanisms. If there were no businesses, who would the banks live with? Banks need businesses. Only when businesses are healthy and profitable can they repay their debts to the banks.”

Therefore, it is necessary to remove obstacles for businesses. If banks only focus on achieving profit targets without lowering interest rates, how can things be stable?" the Deputy Governor reminded.

Therefore, in addition to the four state-owned commercial banks that have taken the lead in significantly lowering interest rates, the Deputy Governor requested that other banks continue to proactively reduce lending interest rates, especially for existing loans.

Regarding interest rate management in the coming period, Deputy Governor Dao Minh Tu said that the State Bank of Vietnam will continue to manage interest rates in a stable manner, lowering them further when conditions permit, and even the policy interest rate may be reduced further if conditions are suitable.

Nevertheless, representatives of the State Bank of Vietnam also acknowledged that managing interest rates is the most difficult challenge in macroeconomic management today.

"When interest rates fall sharply, exchange rate stability is at risk of being disrupted, affecting foreign borrowing, national credit ratings, etc. This forces the State Bank of Vietnam to carefully consider and harmonize many factors in managing monetary policy," Mr. Tu said.

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