The State Bank of Vietnam raised the dollar-dong rate by 1 percent to 21,246 on Thursday.
HSBC announced that it wouldn’t weaken the dong thanks to rich foreign reserves.
In a press release issued the night before the announcement, HSBC said the hike aims to support exports during the second half of the year.
The rate has remained stable for nearly a year and is now being adjusted for inflation, the Hong Kong-based bank said. Vietnam’s consumer prices index rose 1.08 percent in May from the end of 2013.
The interbank rate is allowed a 1 percent margin, meaning commercial banks can push the rate between 21,458 and 21,034.
The central bank said a stable cash supply will be guaranteed, thanks to Vietnam’s US$1.6 billion trade surplus during the first five months of 2014.
HSBC called the change minor and predicted that it would not significantly affect businesses and banks. The bank said that the dong’s value is supported by rising export and lower import growth.
Foreign direct investment into Vietnam has reached an average of $1 billion a month this year.
HSBC said those factors have secured the central bank’s foreign reserves, which increased to nearly $10 billion last year.
Nguyen Thi Hong, director of the Monetary Policy Department at the central bank, said it bought more than $10 billion of foreign currency during the first five months this year from lenders, which got it from businesses and individuals.
State Bank Governor Nguyen Van Binh said the bank will keep changes in the dollar/dong exchange rate within 2 percent this year.
Commercial banks like VietinBank, Asia Commercial Bank and Eximbank raised their dollar/dong rate in recent days, buying at up to VND21,240 a dollar and selling at VND21,246, according to a report by Tuoi Tre (Youth) newspaper.
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