Governor of the State Bank of Vietnam (SBV) Nguyen Thi Hong (Photo: VNA)The SBV is also willing toprovide liquidity to credit institutions, especially at the end of the yearwhen capital demand often peaks, Hong said.
The domestic monetary market last month saw complicated movements with depositinterest rates increasing significantly, hitting more than 10% per year at somebanks.
According to Hong, in October,the market was mainly affected by psychological factors and complicatedmovements of the world economy. Under this context, the SBV promptlyprovided liquidity to support the banking system.
She said the SBV held an emergency meeting last week with credit institutionsto discuss liquidity in the banking system. At the event, credit institutionsagreed in the current context, they needed to strengthen their solidarity,trust and support for each other for the sake of ensuring the safety of boththe entire banking system and each credit institution.
The central bank assessed that credit institutions have ensured operationalsafety indicators according to the SBV’s regulations. However, in order toactively respond to the complicated fluctuations of the global and domesticeconomy, credit institutions themselves found that it was necessary to reviewand evaluate more carefully to proactively have solutions to improve theirperformance and ensure the banking system is safe.
Hong said it is inevitable for Vietnam’s economy and currency to be affected byadverse impacts of the world market as the country has integrated deeply intothe world economy. Vietnam, therefore, has to proactively deal with thefluctuations.
In fact, in 2022, under the direction of the Government and the Prime Minister,the SBV as well as other ministries and branches have taken proactive andflexible solutions to respond, which contributed to helping economic stability.
Under the current context, the Governor said the SBV as well as otherministries and branches need to strengthen forecasts, analysis and update newdevelopments to proactively come up with timely and effective solutions.
Currently, the Government and the Prime Minister have been directing toaccelerate the disbursement of public investment and implement expansionaryfiscal policies, which will help ease pressure on the currency and credit ofthe banking system. The Government’s policies to enhance trade promotion toboost exports and promote foreign investment attraction are also expected toimprove the supply and demand of foreign currencies as well as reduce pressureon the exchange rate.
“The market is now evolving in a positive way, and market sentiment is calmnow,” Hong said.
According to the Governor, it is true that the monetary and foreign exchangemarkets are under pressure, but it is a common trend in many countries aroundthe world, not just Vietnam. She noted it is important that Vietnam’s economicfundamentals remain very positive and international credit rating agencies,such as Fitch Ratings, have recently continued to affirm Vietnam’s long-termforeign-currency issuer default rating at 'BB' with a positive outlook.
“The SBV will actively supervise the actual situation to come up with suitablesolutions in order to consistently achieve the goals of stabilising themacro-economy, controlling inflation and ensuring major balances of the economyand social security,” Hong said./.
VNA
