Avoiding Exchange Rate Risks

摘要

The Vietnamese dong (VND) is under a heavy pressure of devaluation although it experienced a yearrnof full volatility in 2008.rnIn 2008, the exchange rate rose 5.4 per cent in the interbank market, compared with 0.14 per cent in rn2007. The rate was more than 8.5 per cent in transactions at credit institutions. On the free market, it was 9.1 per cent, compared with 0.19 per cent in 2007.rnRemarkably, USD fevers had widened the spread between the rate on the interbank market and thernfree market to VND2,000 per USD.rnThe State Bank of Vietnam's widening of the exchange rate band to 3 per cent was seen as a move tornlet the local dong to devalue 3 per cent against USD. At present, one USD is equivalent to VND17,400.