Chủ đề: Interest rates

Bidding on government bonds is at a low level, although registrations are 1.8-times higher than bids. At the same time, interbank interest rates have remained high. This shows that the pressure to increase interest rates is becoming increasingly clear, especially as the speed of public investment disbursement will gradually rise.

The interest rate differential between the primary and secondary bond markets is widening. In addition, credit institutions are participating less in the government bond market due to concerns over high inflation as well as expectations of a new interest rate hike. The pressure to increase government bond interest rates in the primary market is therefore becoming clearer.

Different banks cutting or raising deposit interest rates for different terms, according to Bao Viet Securities Company.

The corporate bond market is expected to continue to develop this year, with expansions seen in the size and diversity of products and with an increasingly complete legal framework that ensures sustainable development. Low interest rates will also work in the market’s favor.

Vietnam has available foreign exchange reserves of more than $100 billion and debts below 40 per cent of GDP, which are mostly soft loans from supranational lenders on favorable terms. Such debts do not increase the country’s vulnerability to tightening global monetary policy. Experts from VinaCapital believe that Vietnam is in a favorable position and will be under no pressure when the US Fed hikes interest rates this year.

The banking sector should continue to support and remove difficulties facing individuals and businesses, promote the recovery and development of production and business, and further cut lending interest rates, especially for priority sectors, and direct capital flows into production and business, Deputy Prime Minister Le Minh Khai told a conference on the tasks in 2022 for the banking sector on December 29.

The central bank held a regular press conference on December 28, where it summed up the banking sector in 2021 and set tasks for 2022.

Analysts believe that as liquidity in the banking system continues to be abundant and credit begins to open up, interest rates will remain low until the end of the year.

In line with a move that began last month, some banks have shaved their deposit interest rates. ACB is currently offering the highest rate, followed by MSB and LienVietPostBank.

Experts believe that because the management level has not withdrawn money through the open market channel, both interest rates and exchange rates on the interbank market have fallen sharply. Prolonged social distancing in Hanoi, Ho Chi Minh City, and other localities has also affected production and business activities, and demand for output credit has also gradually fallen, creating capital congestion in the system.