Stable exchange rate facilitates enterprises

Stable exchange rate facilitates enterprises. Picture: ST.

Remain stable

The central rate listed by the State Bank of Vietnam (SBV) on July 5, 2017, was at 22,444 vnd/USD, increased by 13 vnd compared to the session of the early week (July 3). Meanwhile, at commercial banks, the movement of the exchange rate only increased - decreased with a short amplitude, about 5-10 VND, making the USD price in the market almost stable. This is due to the flexible management of the SBV, as well as many favorable factors such as market liquidity, abundant foreign exchange reserves (currently approximately $US 42 billion), foreign investors increase capital disbursements and buying shares. Moreover, according to experts, the increase in central rate is a positive move by the State Bank to adjust the rate step by step, avoid shocks, help the SBV can better deal with the scenario that the US Federal Reserve System (FED) can raise the dollar interest rate in the coming time.

However, the exchange rate in the coming time is predicted to face with many difficulties as the economy continues its trade deficit, the FED continues to raise interest rates. Therefore, financial economist, Dr. Nguyen Tri Hieu said, from now until the end of the year, the exchange rate would continue to increase about 2%. Meanwhile, economist, Dr. Dinh Tuan Minh, MarketIntello Managing Director, said the vnd fell by 0.5% in 2017. Previously, the company had predicted that the exchange rate would rise by 1-1.5%. Explaining the reason to reduce prediction, according to Mr. Minh, this is due to the fact that in the country, the balance of trade continues to be in balance while capital is surplus and foreign exchange reserves are abundant.

Reporting about the exchange rate situation to the Government, Mr Le Minh Hung, Governor of the State Bank of Vietnam said that although the first half of the year was affected by many unfavorable factors, the exchange rate was stable and in line with the managing objectives set out by the SBV since the beginning of the year. contributing to stabilizing the macro economy, facilitating for enterprises to take the initiative in production and business, preventing exchange rate risks. However, the SBV will continue to monitor the domestic and international market movements, actively take measures to control exchange rates, ensure foreign currency liquidity of the economy, avoid speculation.

Enterprises are benefit

With the import-export enterprises, the stable exchange rate situation will create favorable conditions for production and business activities, not affect the signing of orders. Because according to enterprises, orders are often negotiated and signed previously, the exchange rates fluctuate that will impact, or eventually cause companies to offset losses. Therefore, the exchange rates at domestic commercial banks keep stability that helps enterprises feel more secure in the transaction. Moreover, as the foreign exchange rate is not "waving" as it is today, the price of manufactured products of domestic enterprises also remained stable, eventually having a lower price, which helps to raise the competitiveness with cheap import items.

Sharing about this issue, Mr. Le Anh Van, Business Executive of Austrong Vietnam Co., Ltd. (the units specialized in the field of importing and trading of building materials) said that depending on the type of contract and the time of signing, the exchange rate has impacted on the company. Some contracts have agreed to keep the price, some based on a fixed exchange rate, but the other has the rule depending on the fluctuation of the exchange rate at the delivery time. Thus, if the exchange rate increases highly, the company must offset losses, but if the exchange rate falls, it will get benefits. Therefore, if the exchange rate increases too high, the sales volume will decrease, affecting the import of enterprise. In addition, for businesses in the service sector, the increase of exchange rate will cause the cost increase of transportation, leading to raising commodity prices. This will greatly affect the competitiveness of enterprises.

In general, with the current management of exchange rates of the SBV, enterprises may be assured, the "path" of the exchange rate can be formed from now until the end of the year. However, the unpredictable changes of the world economy can still cause unexpected effects, so enterprises and agencies have to take the initiative, closely monitor the market movements to cope with timely.