return icon

China yuan depreciation puts VND under pressure: experts

A currency war could break out among a number of countries, Nguyen Tri Hieu, a finance expert told the press recently.

In the past week, the world has witnessed a successive events that can have a big impact on the global economy.



On August 1, the US FED decided to slash the prime interest rate by 0.25 percent to 2-2.25 percent. This was the first interest rate cut from the agency since the world financial crisis in 2008.

Also on August 1, the US announced the imposition of the 10 percent tax on $300billion worth of imports from China, pushing the US-China trade war to a new level.

On August 5, the Chinese yuan value fell to an 11-year low. This was the first time since 2008 the currency has fallen from the important US$1= 7 yuan threshold.

The Chinese yuan is predicted to be weaker in 2020 when the Chinese administration changes the strategy to deal with the US in the trade war.

On August 5, the Chinese yuan value fell to an 11-year low. This was the first time since 2008 the currency has fallen from the important US$1= 7 yuan threshold.

 Hieu, analyzing the rapid-fire events, said Vietnam may face challenges.

The US Fed thinks it is the right time to raise interest rate to control inflation.

However, with pressure from the White House, FED had to cut the interest rate by 0.25 percent, which will make the value of the dollar decrease and loans cheaper, and help pump money into circulation and support exports.

The depreciation of the dollar will have an impact on Vietnam. Hieu believes that when the US dollar value decreases, this will help ease pressure for devaluation and increase dong stability. This means that Vietnam’s economy would reap positive results.

“The FED’s move on slashing interest rate will facilitate Vietnam’s plan to ease interest rate. The government of Vietnam wants banks to lower the lending interest rates applied to some priority business fields,” he said.

However, the other events are not good for Vietnam, according to Hieu.

The devaluation of the Chinese yuan is seen by Hieu as counter-attack to Trump’s decision on levying $300 billion worth of products from China.

The move will put pressure on Vietnam. When the Chinese yuan depreciates and Vietnam dong value remains stable in comparison with the dollar, this means the Chinese yuan will lose its value against the dong. This will pave the way for more Chinese goods to enter Vietnam.

“This would create unfavorable conditions in trade between Vietnam and China as Vietnam’s deficit in trade with China may increase,” Hieu said.

Chi Mai



China's prolonged falling yuan may harm Vietnam's trade

China's prolonged falling yuan may harm Vietnam's trade

China’s yuan (renminbi) has remained above the sensitive level of seven to the US currency for the last three days, hinting that trade friction between the US and China is entering a dangerous phase.

Vietnam’s producers meet difficulties as yuan weakens.

Vietnam’s producers meet difficulties as yuan weakens.

In an effort to encourage exports in the context of the trade war, the Chinese central bank PBOC has set the yuan/US dollar reference exchange rate at 6.8365 yuan per US dollar, the lowest level since January 2019.


Experts warn Vietnamese banks of risks following US banks’ collapse

If bond issuers fall into insolvency, the price of bonds could fall to zero, creating a high risk for banks.

Hanoi to resume tourism services on West Lake

Hanoi may resume 12 tourism services on the West Lake including boat transportation, after six years of suspension.

Car imports from Thailand still hold largest market share in Vietnam

Thailand once again led the market in terms of value and the number of CBU (complete built unit) cars imported to Vietnam in February 2023.

Deputy PM holds bilateral meetings on sidelines of UN 2023 Water Conference

Deputy Prime Minister Tran Hong Ha had bilateral meetings with many foreign leaders on the sidelines of the UN 2023 Water Conference, which is taking place in New York from March 22-24.

Vietnam temporarily suspends import, circulation of 15 types of medicines

The Drug Administration of Vietnam (DAV) under the Ministry of Health (MoH) has just issued an official dispatch on suspending the import, distribution, circulation and use of 15 types of medicines produced by Arena Group S.A. of Romania.

EVN urged to negotiate with renewable energy investors to fix electricity price

The Ministry of Industry and Trade has urged the Electricity of Vietnam (EVN) and investors of transitional solar and wind plants to negotiate and agree to fix electricity prices before March 31.

Two arrested in 11kg drug transport from France to HCM City case

The Ho Chi Minh City Department of Public Security has just arrested two people involved in the case of transporting over 11 kilograms of narcotics and ecstasy from France to Tan Son Nhat International Airport, Vietnam.


Renowned Vietnamese artists collaborate on unique porcelain artworks


Dragon fruit export turnover reaches 47 million USD

Boxer beats Spainish rival to advance to World Championship’s semifinals

Vietnamese boxer Nguyen Thi Tam trounced Spanish rival Laura Fuertes 5-0 in the women's light flyweight category to advance to the semifinals of the IBA Women’s World Boxing Championships in New Delhi.

Ministry of Health warns of possible outbreaks of dangerous diseases

In its yesterday’s official dispatch to people's committees of provinces and cities on organizing the implementation of the 2023 epidemic prevention plan, the Ministry of Health warned of possible outbreaks of dangerous diseases.

Another enterprise issues bonds, real estate bonds increase in value

A real estate firm has successfully raised funds by issuing VND4.7 trillion worth of corporate bonds. Just days before, another real estate firm also successfully issued VND2.3 trillion worth of bonds.

Stock market violations to face stricter sanctions

The State Securities Commission (SSC) will review the Law on Securities and related decrees to complete the legal framework, and strengthen sanctions for violations to protect the legitimate rights and interests of investors.

Association calls for pilot implementation of battery-powered taxis

The Hanoi Taxi Association is urging for the pilot implementation of battery-powered cabs to reduce environmental impact and stay abreast of global trends.

Vietnam strives to eliminate malaria once and for all

The Ministry of Health has announced plans to review, amend, and supplement professional guidelines to ensure nationwide implementation and assess the National Strategy for Malaria Prevention, Control, and Elimination by 2020.