Central bank on verge of further easing monetary policy: expert
The State Bank of Vietnam (SBV) may continue to ease monetary policy with inflation well under control, said Nguyen Xuan Thanh, a lecturer at the Fulbright School of Public Policy and Management.
He said inflation fell from 4.9% in January to 4.3% in February, and is forecast to further decrease this month.
“From now to May, if inflation continues to remain below 4.5%, it will offer favorable conditions for the SBV to further ease monetary policy,” he said.
According to Thanh, the SBV has been buying up foreign currencies to increase its reserves after selling about $27 billion late last year to support the USD/VND exchange rate.
“If the Vietnamese dong remains stable and the central bank increases its foreign currency reserves and pumps out VND, this will be an opportunity for Vietnam to relax monetary policy tightening. However, we still need to be cautious," the lecturer noted.
Many experts said the central bank’s recent move to cut policy interest rates signals an easing of monetary policy, and deposit and lending interest rates are expected to cool.
Previously, the SBV announced a 1 percentage point reduction on several policy interest rates to bolster the economy and aid businesses.
From March 15, the annual rediscount rate fell from 4.5% to 3.5%, while the overnight electronic interbank rate and interest rate for loans to offset capital shortfalls in clearance between the central bank and domestic banks dropped from 7% to 6%.
The maximum short-term lending interest rate in Vietnamese dong for priority sectors was also cut from 5.5% to 5% per year, while the maximum short-term lending rate in Vietnamese dong at public credit funds and microfinance institutions was brought down from 6.5% to 6% per year. Immediately after the SBV's announcement, interbank interest rates fell sharply.
According to SBV data, the average overnight inter-bank lending interest rate in Vietnamese dong on March 22 fell to 1.55% per year - the lowest level since mid-July 2022. It more than halved compared to the end of the previous week and was 4.85 percentage points lower than its peak recorded in early March.
Similarly, interest rates for one-week, two-week and one-month terms plunged to 1.98%, 2.26% and 4.44% per year, respectively.
In recent days, a series of commercial banks including OceanBank, BaoVietBank and Kienlongbank have adjusted their deposit interest rates to below 9%. Currently, only ABBank and Saigon Commercial Bank (SCB) are offering 12-month deposit interest rates from 9% per year.
Deposit interest rates at the four largest state-owned banks, Vietcombank, BIDV, VietinBank and Agribank, now average 7.2% for 12-month terms.
Notably, some banks have changed their base interest rates, which are used to calculate lending rates.
On March 22, Techcombank applied a new base interest rate for loans to buy real estate and cars, or build and repair houses, of 9.4% per year.
Meanwhile, the rate for loans of 12 months or less at Saigon-Hanoi Bank (SHB) now stands at 10.7%-10.9 per year.
- Read More
Vietnam manufacturing activity rebounds, recovering from typhoon Yagi
The Vietnamese manufacturing sector in October started to recover from the effects of September's typhoon, recording renewed increases in both output and new orders.
Economy - Fri, November 1, 2024 | 8:34 am GMT+7
Vietnam private lender VietBank logs 96% profit growth in 9 months
Vietnam Thuong Tin Commercial Joint Stock Bank (VietBank) posted a 96% year-on-year surge in pre-tax profit in the first nine months of 2024 to reach VND820.4 billion ($32.46 million), or 78% of the year's target.
Banking - Fri, November 1, 2024 | 7:45 am GMT+7
Maersk opens its first bonded warehouse in Vietnam
Denmark's integrated transport and logistics giant A.P. Moller - Maersk (Maersk) on Thursday opened its first bonded warehouse in Vietnam at SLP Park, Nam Dinh Vu Industrial Park in Hai Phong city.
Industries - Thu, October 31, 2024 | 11:44 pm GMT+7
ABBank incurs $14 mln loss in Q3
Hanoi-headquartered An Binh Commercial Joint Stock Bank reported a pre-tax loss of VND343.5 billion ($13.59 million) in the third quarter of this year, while some other private Vietnamese banks posted strong profits.
Banking - Thu, October 31, 2024 | 9:29 pm GMT+7
Vietnam’s emergence as regional manufacturing hub a significant logistics opportunity: SuperPort exec
Southeast Asia’s rise as a vital logistics hub with Vietnam positioned as a key manufacturing center presents a significant business opportunity, says Yap Kwong Weng, CEO of Vietnam SuperPort.
Companies - Thu, October 31, 2024 | 9:01 pm GMT+7
Indonesia steps up support for textile industry
Indonesia’s President Prabowo Subianto held a close-door meeting with several ministers on Tuesday to discuss the current situation of Indonesia's textile industry, particularly focusing on textile giant Sri Rejeki Isman (Sritex).
Southeast Asia - Thu, October 31, 2024 | 6:01 pm GMT+7
Thailand speeds up plans to construct six new airports
Thailand’s Transport Ministry is accelerating development and construction projects on six airports with an aim to become the region's transportation hub.
Southeast Asia - Thu, October 31, 2024 | 6:00 pm GMT+7
Thailand develops eco-friendly seaport model
Thailand is striving to implement environmental protection and social sustainability solutions in developing the country’s major infrastructure projects, such as the development of Phase 3 of Laem Chabang Port, Thailand's only deep-sea port.
Southeast Asia - Thu, October 31, 2024 | 5:58 pm GMT+7
Indonesia intensifies oil palm cultivation to meet biodiesel demand
Indonesia is expanding its oil palm cultivation to increase crude palm oil (CPO) production as a raw material for 50% biodiesel (B50), according to the country’s Ministry of Agriculture.
Southeast Asia - Thu, October 31, 2024 | 5:56 pm GMT+7
Malaysia’s first domestic EV model opens for booking
The Malaysian multinational automotive company Proton's first electric vehicle (EV), the e.MAS 7, is now open for booking.
Southeast Asia - Thu, October 31, 2024 | 5:54 pm GMT+7
Thailand aims to become emerging leader in AI
Thailand is positioning itself as an emerging leader in artificial intelligence (AI) regulation and development, thanks to policies that support an approach that balances technological innovation with ethical considerations and workforce protection.
Southeast Asia - Thu, October 31, 2024 | 5:53 pm GMT+7
Vietnam PM calls for more investment from Qatar’s $475 bln sovereign wealth fund
Vietnamese Prime Minister Pham Minh Chinh has called on the Qatar Investment Authority (QIA), Qatar's sovereign wealth fund with total assets amounting to $475 billion as of 2023, to ramp up its investment in Vietnam.
Industries - Thu, October 31, 2024 | 4:43 pm GMT+7
FPT Retail earns $6.5 mln in Q3 profit, to expand FPT Shop chain
Vietnamese retail major FPT Retail made a profit after tax of VND165 billion ($6.52 million) in the third quarter of this year, while it incurred a loss of VND13 billion ($514,000) in the same period last year.
Companies - Thu, October 31, 2024 | 3:56 pm GMT+7
Germany’s PNE opens rep office for $4.6 bln offshore wind project in central Vietnam
Germany’s PNE AG, a leading developer of renewable energy projects, has shown its determination to proceed with a mega offshore wind power project in central Vietnam by opening a representative office there.
Energy - Thu, October 31, 2024 | 2:43 pm GMT+7
Saudi Arabian energy giant ACWA Power ready to invest $5 bln in Vietnam
Saudi Arabian private energy giant ACWA Power stands ready to invest up to $5 billion in Vietnam, a senior executive said Wednesday.
Industries - Thu, October 31, 2024 | 2:39 pm GMT+7
Effective M&A deal depends on thorough understanding, value addition potential: Kido exec
An effective M&A transaction depends on fully understanding the company being acquired in order to create added value, says Kido Group CEO Tran Le Nguyen.
Companies - Thu, October 31, 2024 | 1:22 pm GMT+7
- Consulting
-
Remove roadblocks to lure foreign investment into Vietnam: HSBC exec
-
Rethinking resilience: How typhoon Yagi redefines supply chain strategies in northern Vietnam
-
In trade and investment, ASEAN and China are better together
-
AI can be a game changer for Vietnam tourism
-
Investment opportunities in LNG-to-power projects in Vietnam
-
Pepper prices 2024: will the dream of 'black gold' repeat?