The State Bank of Vietnam (SBV) will sell foreign currency through forward contracts on 25–26 August to credit institutions with negative USD positions, Dau Tu Online has reported → view source.
The selling rate is fixed at VND 26,550 per US$1.
Key details:
- Eligible buyers: Credit institutions with negative foreign currency balances.
- Transaction cap: Each bank may only buy enough to balance its position.
- Cancellations: Up to 3 times for contracts over US$100m, 2 times for smaller ones.
- Timing: Cancellations allowed until one working day before maturity.
- Market context: SBV raised the central rate to VND 25,295 per US$1 on 22 August, a record high.
- Exchange rate movement: VND down 3.8 percent year-to-date, with banks selling USD at ceiling last week.
The SBV’s return to forward-based ForEx interventions is a sign of growing pressure on the dong that is not showing signs of easing.
This will, of course, put the local currency in even riskier territory than it is already — Vietnam’s ForEx reserves are currently sitting around US$80 billion which is enough to cover two months’ worth of imports but not the three the IMF recommends.
See also: How Low Can the Vietnamese Dong Go? Why it’s Sliding & What Might Happen Next