That said, the US Treasury did say that none of its trade partners appeared to be manipulating their currencies, according to Reuters.
Countries make the currency manipulation watch the meet two of the following three criteria:
- They have a trade surplus of US$15 billion or more.
- They have a current account surplus of 3 percent or more of their total GDP.
- Persistent, one-sided intervention with net purchases of foreign currency conducted repeatedly, in at least 8 out of 12 months, totaling at least 2 percent of a country’s GDP over a 12-month period.
Per the Treasury report, Vietnam’s current account surplus was 4.7 percent of GDP over the 12-months to June 2023, which has seen it returned to the watch list.
Note that: Vietnam was removed from the monitoring list last year, however, recent economic challenges have seen pressure on the dong rise and the State Bank intervene in a number of different ways including using its foreign reserves and issuing t-bills.
Full report from the US Tresury: Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States