Vietnam Devalues Dong

123jump.com Staff
25 Dec, 2008
New York City

Vietnam devalues its currency as the current account deficit rises, economic growth slows and export fall faster than anticipated. The State Bank of Vietnam relaxed the trading band for the currency to 3% as exports of garments, shoes and toys stagnate. For the year the dong has fallen 5.5%.

[R]11:00AM New York – Vietnam devalues the dong as current account deficit balloons and exports decline.[/R]

Vietnam devalued its currency 3% as the country battles slowing economy, rising current account deficit and falling exports.

The State Bank of Vietnam lowered the exchange rate to a dollar at 16,989 dong from 16,494 on Wednesday. The dong has declined 5.4% against the dollar lower than decline in currency declines of other nations in the region.

Exports from Japan, China, India, Thailand, Vietnam and Singapore have declined in the latest month as the economies in the U.S. and Western Europe slip into a recession.

Vietnam is likely to grow at between 6% and 6.2% in the year, slowest since 1999 and current account deficit is expected to surge to $10 billion in the year. Current account deficit may rise above $12 billion in 2009 if exports do not pick up and if the country maintains the current level of infrastructure investment.

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