Dong to Depreciate against the U.S. Dollar

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Mar. 24 – Vietnam's central bank announced that it would widen its trading band to plus or minus 5 percent beginning today; depreciating its currency, the dong, against the U.S. dollar.

The move was made to support the economy and enhance flexibility. The central bank said: "The decision will help banks and companies be proactive in preparing production plans in 2009."

Yesterday, it was 16,980 dong to the dollar compared to last Friday's 16,981 to the dollar. "The move will facilitate the trade of dollars among commercial banks," said Ho Huu Hanh, director of the State Bank of Vietnam's branch in Ho Chi Minh City was quoted by the WSJ.

The change trading band will aid companies to increase exports becuase of the devaluing value of the dong.