After Vietnam secured arguably the best US tariff deal amongst all ASEAN nations we now wait to measure the true economic impact, and contrast it with the impacts on markets competing with Vietnam to continue supplying US consumers. Inflation remains below target, employment slightly up, the dong continues to slide against the USD.
Monetary Policy
As August began the State Bank of Vietnam (SBV) urged lenders to reduce interest rates and stabilise deposit rates so as to support economic growth. Despite the policy rate having been at 3% since February, and overnight interbank rates currently sitting at 3.88%, lending rates still average 6.23% and deposit rates 4.18%. Recall that in February the SBV had told banks to reduce their operating costs and accept that they would make less profits so as to offer lower lending rates in order to boost lending and support achievement of the government’s 8% growth target. Inflation currently sits at 3.19%, with the SBV’s target being 4.5% (higher tha...
You must be signed in to read this content. Please enter your user name and password below for access. Want the full Brief? Register free for full access to 16+ countries. Register for free here.