Vietnam’s central bank (SBV) raised its daily reference rate to VND 25,182 per US$1 on July 28, up 18 dong from July 25.
Meanwhile, the mid-market rate tracked by Google Finance climbed by 53 dong to VND 26,200, suggesting continued pressure on the dong.
Official and market exchange rates diverge
On the black market, rates actually eased slightly to VND 26,410, narrowing the gap with the official market rate.
The difference between the unofficial and Google mid-market rates fell to 0.80 percent, down from 1.04 percent just three days earlier.
Dollar liquidity injection ramps up
The State Bank of Vietnam conducted a large-scale injection of US dollars into the banking system through repos.
Total 7-day repo transactions surged to US$7.67 billion, up from just US$463 million on July 25.
The 14-day and 28-day repo windows were also heavily utilised, with injections of over US$6.25 billion and US$2.1 billion, respectively.
There were no 91-day repos or T-bill issuances.
These actions indicate that SBV is actively using dollar liquidity tools to stabilise the currency and ease short-term pressure in the interbank system.
Dong interest rates remain elevated
Despite the dollar liquidity push, dong interest rates continued to rise across most short-term tenors:
- Overnight lending jumped to 5.95 percent from 5.26
- 1-week and 2-week rates increased to 5.63 and 5.79 percent, respectively
- Only the 1-month rate declined slightly to 4.88 percent
- 3-month and 6-month rates held firm at 5.13 and 5.44 percent
The elevated short-term rates suggest ongoing stress in the dong funding market, even as longer-term liquidity remains more stable.
See also: How Low Can the Vietnamese Dong Go? Why it’s Sliding & What Might Happen Next