Vietnam devalued its currency by 2.1 percent on Tuesday in a bid to control its trade deficit, the State Bank of Vietnam said. The new average interbank rate - effective Wednesday - will be 18,932 dong per United States dollar, compared with 18,544 previously, the bank said in a statement.
It said the move aims "to contribute to the curbing of import surplus." Vietnam's central bank, however, maintained a 3.0 percent daily trading band for buying and selling US dollars by commercial banks. The latest devaluation is the third since late last year, after a 3.4 percent change to the interbank rate in February, and a 5.4 percent adjustment in November when the State Bank also reduced the trading band from 5.0 percent.
After the February rate change Singapore-based DBS Group Research said further devaluations would likely follow during the year. In a rebounding economy, Vietnam's trade deficit more than tripled in the first six months of 2010 compared with the same period last year, according to official data.
Imports rose 29.4 percent year-on-year during the first half while exports gained 15.7 percent, with the estimated trade deficit at 6.73 billion dollars. That compared with a 2.1-billion-dollar deficit estimated in the first half of last year, the General Statistics Office (GSO) said.
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