HÀ NỘI — The State Bank of Vietnam (SBV) has recently implemented a new measure, intervening in the foreign exchange market that has helped cool the market.

Accordingly, instead of using spot contracts to sell the US dollar as previously, the SBV has stopped this and has started to use the futures contract, to sell the greenback at a price of VNĐ25,450 per dollar.

The price is considered reasonable, as there is no big difference compared to the market price.

The SBV’s move has been highly appreciated by experts, especially in the context that the foreign exchange market has seen many fluctuations at the end of the Lunar New Year, as it has emphasised the SBV’s commitment in maintaining stability in the foreign exchange market and ensuring to have no unexpected changes.

Experts explain the measure is a more stable and transparent approach as it helps the market feel secure that there will be no sudden changes in exchange rate policy. The provision of dollar futures contracts (with an optional cancellation) shows the SBV's confidence in keeping the interbank exchange rate stable at around VNĐ25,450. It helps eliminate market expectations that the SBV will increase the intervention price.

Analysts from the GBF Securities Company said the SBV emphasised that there was no change in the spot dollar selling price. At the same time, the SBV also committed to maintaining this price consistently, which was a positive signal to help the market avoid unexpected fluctuations.

Following the SBV’s move, the VNĐ/VNĐ exchange rate on the interbank market has decreased sharply and returned to the threshold of VNĐ25,400 per dollar.

Analysts at the ACB Securities Company (ACBS) expect the domestic interbank exchange rate may continue to decline and trade around the target level of VNĐ25,350 - 25,420 per dollar.

In 2024, external shocks, such as the US Federal Reserve (Fed)'s interest rate policy and geopolitical risks, strongly impacted the VNĐ/USD exchange rate.

Faced with the complicated developments of the exchange rate, the SBV last year had to flexibly intervene through the sale of dollars from the nation’s foreign exchange reserves, in addition to the issuance of short-term treasury bills to reduce the increase in the exchange rate.

The measures helped the Vietnamese đồng to be among currencies that depreciated the least in the region. By the end of 2024, the VNĐ/USD exchange rate increased by 4.31 per cent compared to the beginning of 2024, compared with 12.51 per cent of Korea’s won, 4.74 per cent of Philippines’ peso and 4.85 per cent of Indonesia’s rupiah. — VNS