Banks in Vietnam increased U.S. dollar prices to a one-month high on Wednesday, reaching the VND22,820 mark and resting just below the ceiling set by the State Bank of Vietnam.
In the early afternoon, ACB and Eximbank both quoted the greenback at VND22,820, VND90 and VND110 higher than their respective rates earlier this week.
Vietcombank set an asking price of VND22,790 to the dollar before increasing the rate to VND22,800 at 4:00 pm.
The State Bank of Vietnam fixed the Wednesday mid-point rate at VND22,236 to the dollar, up one dong from Tuesday. With the dollar/dong trading band set at +/- 3 percent of the mid-point rate, the ceiling price for the dollar yesterday was VND22,903, meaning the greenback was selling at just VND83 to VND113 below the ceiling.
Local economic experts say increased dollar prices are due to the rising demand of businesses in need of foreign currency to complete import orders.
The rise might also be caused by Vietnamese businesses stockpiling dollars in preparation for excess pressure to be put on foreign exchange rates in the near future due to an expected interest rate hike by the U.S. Federal Reserve System.
On Thursday, the central bank set the mid-point rate at VND22,234, down VND2 from yesterday, the first drop in eight days.
With the new ceiling price of VND22,901, banks were still trading the dollar above the VND22,800 mark in the morning session.
As of 10:00 am, Vietcombank, BIDV, ACB and DongA Bank were selling the greenback at VND22,800 while Vietinbank quoted the dollar at VND22,820.