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Five-year bonds rise on bank surplus; dong declines
Vietnam’s five-year bonds rose on speculation banks have surplus funds to put into debt after they raised interest rates on deposits to draw investors. The dong fell.
“The cash surplus at local banks is relatively abundant now and some banks have returned to purchase bonds,” said Vu Anh Duc, a bond dealer at Hanoi-based Vietnam Bank for Industry and Trade, known as VietinBank.
The yield on the five-year note fell three basis points to 9.69 percent, according to a daily fixing price from 10 banks compiled by Bloomberg. A basis point is 0.01 percentage point.
“However, the trend for yields from now to the end of the year is still rising,” he said, adding that the country is still faced with the risk of inflation returning, especially after the government increased fuel prices.
Vietnamese banks have raised rates on dong deposits to as high as 10.2 percent to attract more funds, Hanoi Moi newspaper reported Monday, citing local banks.
Vietnam’s dong fell 0.03 percent to VND17,802 per dollar as of 4:10 p.m. in Hanoi Monday, from VND17,796 late last week.
The State Bank of Vietnam fixed the reference rate at VND16,955 Monday, compared with VND16,953 on July 3, its website showed. The currency is allowed to trade up to 5 percent on either side of the set rate.
thanhnien, bloomberg
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