US/Vietnam exchange rate keeps stable despite central bank’s rate cuts

HANOI: Despite the difference in policies of the State Bank of Vietnam (SBV) and the US Federal Reserve (Fed), the US dollar-Vietnamese dong (US$/dong) exchange rate has remained stable to date thanks to a trade surplus and a bright economic outlook for Vietnam in the second half of this year, experts say.

According to the Maybank Kim Eng Securities Ltd (MKE), there were concerns that the SBV would face big challenges when cutting interest rates drastically while the Fed has still maintained a cautious policy. The contrast in policies between the Fed and the SBV could put pressure on the exchange rate.