$5 bln pumped into Vietnam economy in just one week

Credit institutions in Vietnam injected some VND120 trillion ($4.9 billion) in just one week ending September 29, indicating heightened economic activity towards the year-end, the central bank says.

Total outstanding loans in the banking system reached VND12,749 trillion ($531 billion) as of September 29, up 6.92% from end-2022, Deputy Governor of the State Bank of Vietnam (SBV) Pham Thanh Ha said Wednesday.

Such a credit growth rate accelerated from 5.91% as of September 21, equaling an increase of 1.01 percentage points in one week. However, the pace was still slower than the same period last year.

Ha noted that credit expansion in several priority sectors has outpaced the overall growth. As of July 31, lending for supporting industries and hi-tech businesses had respectively increased by 12.47% and 16.06% from end-2022.

The SBV is aiming for 14-15% credit growth for this year, the same as in 2022.

The Vietnamese central bank has cut its policy rates four times since the start of this year, bucking the global trend as major peers struggled with rising inflation.

Sitting on a mountain of idle funds, commercial banks have cut deposit interest rates to levels even lower than those recorded during the Covid-19 pandemic. The SBV withdrew VND110.6 trillion ($4.53 billion) from the economy via treasury bill auctions in nine days through October 3.