HCMC - The U.S. dollar strengthened against the Vietnamese dong on Thursday, with the exchange rate surging to its daily limit of VND26,345 per U.S. dollar at commercial banks.

The State Bank of Vietnam (SBV) on the morning of July 3 set the central exchange rate at VND25,091 per U.S. dollar, an uptick of VND21 against the previous day. Commercial banks are permitted to trade U.S. dollars within a trading band of 5% on either side of the SBV-quoted central exchange rate. This means they can trade the greenback at between VND23,837 and VND26,345. Exchange rates at commercial banks have soared to record highs, with the U.S. dollar trading at the upper limit of the allowable band. Vietcombank quoted the dollar at VND25,975-26,345, while BIDV listed it at VND26,006-26,345. Eximbank posted rates at around VND25,990-26,345. The dollar has now appreciated over 3.1% against the Vietnamese currency since the start of the year. The short-term depreciation of the dong is attributed to rising foreign currency demand from businesses and pressure from weaker growth expectations amid concerns over tariffs.