The State Bank of Vietnam will continue working with the U.S. government in a “cooperative spirit,” while managing its monetary policy to ensure macroeconomic stability, the regulator said in a statement on its website on Thursday. The central bank will “manage monetary policy to boost reasonable economic growth, control inflation, administer flexible exchange rates in line with global and local market developments,” it said.

The Treasury added five countries to its watchlist this week, including Vietnam, Singapore and Malaysia. The other two Asian countries on the list are Japan and South Korea.

Vietnam was at risk of meeting all three of the Treasury’s new criteria for the currency manipulator tag. The Treasury excused Vietnam’s recent currency intervention, citing movements in both directions and net foreign exchange purposes that had “reasonable rationale” to rebuild reserves.

Countries with a current-account surplus with the U.S. equivalent to 2% of gross-domestic product are now eligible for the list, down from 3%. Other thresholds include persistent intervention in markets for a nation’s currency, and a trade surplus of at least $20 billion. Countries that meet two of the three criteria are placed on the watch list.

Being labeled a currency manipulator doesn’t come with immediate penalties.

The central bank allows the dong to trade within a band of 3% on either side of a reference rate, which is based on eight currencies and is set every day. The currency’s reference rate was set at 23,067 per dollar on Thursday. It traded at 23,418 per dollar as of 1:02 p.m. in Hanoi, little changed from 23,411 yesterday, data from banks compiled by Bloomberg show.

By Nguyen Dieu Tu Uyen - Bloomberg - May 30, 2019