HANOI, Vietnam – Vietnam’s central bank on Wednesday, January 7, said it would devalue the dong currency in a bid to contain inflation and bolster economic growth.
The State Bank of Vietnam (SBV) will devalue the reference rate by 1% to 21,458 Vietnamese dong per dollar to “control inflation and… push up economic growth,” it said in a statement.
The move – the second devaluation in 8 months – is “in accordance with the developments of the domestic and international financial markets, creating a solid stability for the forex market,” the SBV said.
Economist Vu Dinh Anh from the state-run Economic Finance Institute told Agence France-Presse the dong had been under mounting pressure on foreign exchange markets late last year.
“The SBV had to proceed with the adjustment to avoid disadvantages against other currencies,” he said.
In communist Vietnam, the dollar, along with gold, is considered a safe haven against economic uncertainty.
Vietnam’s economy grew 5.98% in 2014 – the highest for 3 years – while inflation slowed to 4.09%, official figures showed.
The government is targeting economic growth of 6.2% this year. – Rappler.com
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