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of money supply in line with the requirements of
the economy.
- Enhancing the credibility of the SBV in the
economy. To do this, it is necessary to provide
a framework for inflation targeting instead of a
current value. This will increase the flexibility for
the SBV.
It is easier for the SBV to achieve its goals in a
volatile exchange rate framework, and the public
will be more confident in the SBV’s ability to
implement its commitments.
- Focusing on the mechanism of transmission
of monetary policy in Vietnam in order to clearly
define the time lag, modes and impacts of policies
implemented by SBV to the objectives of monetary
policy. This is an important and indispensable
issue when Vietnam officially adopts the policy of
inflation targeting.
Fourthly
, developing the interbank market,
creating channels of impact transmission of interest
rates policy. The interbank market plays a very
important role in the transmission of monetary
policy to the economy, which is considered as an
infrastructure for monetary flows.
Through this market, credit institutions can
borrow from each other. Therefore, in the coming
time, the Government should soon submit to
the National Assembly to pass the Law on the
State Bank and the Law on Credit Institutions
towards creating an initiative for the State Bank in
accordance with Vietnamese law and international
practices. This creates a unified legal framework
that will help the SBV to manage the monetary
policy and implement macro policies in a stable
and long-term manner.
In addition, the State Bank should develop
mechanisms of operation of the interbank market
towards opening and minimizing the situation
of asking-subsidizing and operating indirect
tools under the current administrative orders.
It is advised to maintain the fluctuation of the
interbank interest rate within the corridor between
the refinancing rate and the payment of the SBV,
as well as improving measures for banks to trade
with each other on the interbank market, rather
than dealing with the SBV.
Fifthly
, developing the stock market, creating
the bond between the money market and the stock
market to open the capital flow. Developing the
stock market to add more capital mobilization
channels of businesses and investors, avoiding
the pressure that the capital demand put on the
banking system, which will result in difficulties
in increasing interest rates as the last time. Money
market and stock market development will be
like two passing vases in the capital circulation,
the interest rate increase or decrease the bank will
affect the stock price decrease or increase, as well
as affect the flow of capital.
Sixthly,
the information system supporting the
planning and implementation of monetary policy
should be completed. The explosion of banking
services has had a significant impact on the
implementation of monetary policy. New forms of
service such as credit cards, ATM cash dispensers
have made demand more quickly responsive to
interest rate developments, which makes elasticity
of money demand with the interest rate to be on
the increase, accelerates the flow of capital flows,
make demand and supply become more difficult
to predict and the mechanism of transferring
moneytary policy more sensitive.
At present, the problem of market information
has had many inadequate issue, many indicators
are not available for the implementation of
monetary policy. Therefore, in order to have
analytical database defining the mechanism of
monetary policy transmission, the improvement
of the market information system of the country
is very necessary. The application of information
technology will help improve the quality of
currency statistics and the ability of analysis and
economic forecast.
References:
1. Group of Authors (2015), Monetary Finance, Ho Chi Minh City University
of Economics; Publisher of Ho Chi Minh City University of Economics;
2. Pham Van Nang, Tran Hoang Ngan, Truong Quang Thong, Ho Chi Minh
joint stock commercial bank, Looking back on the development road;
Hanoi National University Publishing House 2015;
3.Tran Huy Hoang (2015). Governance of commercial banks, Statistics
Publishing House;
4. Nguyen Thi Minh Hien (2015). Bank Marketing, Statistics Publishing
House;
5. Nguyen Tran Hiep (2016), Brand and Development of Enterprises, Social
Labor Publishing House;
6. David F. Dalessandro (2016), Career War: 10 Principles for Successful
Branding and Protection, Knowledge Publishing House.
