The State Bank of Vietnam (SBV) on January 4 launched the daily average inter-bank exchange rate between the Vietnam dong and the U.S. dollar and reference exchange rates between the dong and some other foreign currencies. The move is in line with the central bank’s Decision No. 2730/QD-NHNN dated December 31, 2015, which took effect on January 4. Based on the average inter-bank exchange rate, local banks and foreign bank branches in Vietnam that provide forex services can quote their dollar buying and selling prices on a daily basis. This rate depends on fluctuations of the average inter-bank exchange rate, developments on world forex markets having close trade, lending, borrowing and investment ties with Vietnam and macro-economic conditions. It must be compatible with Vietnam’s monetary policy targets. A deputy general director of a bank said this rate will depend on a basket of eight hard currencies, and on dollar supply and demand on the domestic market. … [Read more...] about VN central bank applies daily reference exchange rates
European central bank exchange rate
VN central bank adopts flexible rate mechanism
Vietnamese dong weakened 10 to 50 dong per dollar at commercial banks yesterday morning, after the central bank lowered the dong's reference rate for the first time since August. The State Bank of Viet Nam (SBV) yesterday said the fixed reference inter-bank exchange rate was VND21,896 per dollar, six dong higher than the previous level. This is the first time the central bank has quoted the reference rate following the new exchange rate mechanism that it announced in Decision No 2730/QD-NHNN, dated December 31, 2015. The decision said the central bank would set a central rate every day, instead of maintaining a fixed rate for a long period of time. The trading band of the new rate continues to be plus or minus three per cent. The ceiling and floor rates remain almost unchanged with yesterday's minor adjustment. At Vietcombank and BIDV, a dollar was bought at VND22,470 per dollar, increasing 20 dong over the last trading session, while its selling prices hovered around … [Read more...] about VN central bank adopts flexible rate mechanism
Central banks see what they want in ignoring deflation
Federal Reserve Chair Janet Yellen and her international counterparts are suffering from a case of what psychologists call confirmation bias: They keep insisting inflation will accelerate even as it continues to ebb. That's the diagnosis of Ethan Harris, co-head of global economics research at Bank of America Corp. in New York. He says central bankers are seeing what they want to see by blaming subpar inflation in their countries on temporary, partly home-grown forces. That risks ignoring more lasting, global influences ranging from weak worldwide demand and more emerging-market competition to cheap labor in developing nations, cooling commodity prices and technological breakthroughs. "There is much lower-than-expected inflation showing up in too many places in the world to dismiss it as transitory," said Allen Sinai, chief executive officer at consultant Decision Economics Inc. in New York. Almost two-thirds of the 121 economies tracked by Bloomberg are experiencing smaller gains … [Read more...] about Central banks see what they want in ignoring deflation
Three central banks take action in sign of alarm
China, the euro zone and Britain loosened monetary policy in the space of less than an hour on Thursday, signaling a growing level of alarm about the world economy, although suggestions of coordinated action were played down. Of the three, the surprise move was from Beijing which lowered its lending rate by 31 basis points to 6 percent following an interest rate cut just a month ago that also came out of the blue. The European Central Bank cut rates to a record low 0.75 percent following a dire run of economic data. But it steered clear of bolder moves such as reviving its government bond-buying program or flooding banks with more long-term liquidity. Still, a Reuters poll found the ECB is expected to follow the rate cut with more steps to help the region's economy in coming months. The Bank of England, whose rates are already at a record low 0.5 percent, said it would restart its printing presses and buy 50 billion pounds ($78 billion) of assets with newly created money to help … [Read more...] about Three central banks take action in sign of alarm
Central banks shoot 45-minute stimulus salvo as growth slows
Global central banks went on the offensive against the faltering world economy, cutting interest rates and increasing bond buying as a round of international stimulus gathers pace. In a 45-minute span, the European Central Bank and People’s Bank of China cut their benchmark borrowing costs, while the Bank of England raised the size of its asset-purchase program. Two weeks ago, the Federal Reserve expanded a program lengthening the maturity of bonds it holds and Chairman Ben S. Bernanke indicated more measures will be taken if needed. “The actions had the look and feel of a coordinated global easing campaign,” said Nick Kounis, head of macro research at ABN Amro Bank NV in Amsterdam. “The central banks are trying to arrest the synchronized slowdown in global economic growth that has taken shape.” Almost five years since the financial crisis first forced them into action, policy makers are reacting anew as Europe’s debt crisis persists, US hiring … [Read more...] about Central banks shoot 45-minute stimulus salvo as growth slows