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Vietnam bonds fall after US lawmakers reject bailout plan
Vietnam’s five-year notes fell as overseas investors cut holdings of local assets after US lawmakers rejected a US$700 billion rescue plan aimed at stemming the global crisis of confidence.
Benchmark securities ended two days of gains after the US House of Representatives Tuesday voted down the financial rescue package, which was supported by President George W. Bush and leaders of the Democratic and Republican parties.
“Foreign investors have been selling more, particularly Tuesday and today,” said Tran Kieu Hung, a Hanoi-based trader at the Bank for Investment & Development of Vietnam. “They wanted to withdraw holdings in emerging markets after the financial crisis in the biggest economies threatened the liquidity of their investment portfolio.”
The yield on the benchmark five-year note rose 9 basis points (100 basis points make a percent) to 15.86 percent, according to a price fixed daily from 10 banks compiled by Bloomberg. Yields move inversely to prices.
“Demand for bonds is relatively low at present because local investors also followed foreigners and cut buying,” Hung said. “However, it is just a short-term trend and bond prices are expected to increase again because domestic economic indicators are much improved.”
The Vietnamese dong was unchanged for a second day at 16,600per dollar as of 3:20 p.m. in Hanoi, according to data compiled by Bloomberg.
Treasury to offer more bonds Vietnam’s State Treasury will offer VND1 trillion ($60 million) worth of bonds this week, according to a statement from the Hanoi Securities Trading Center, where the auction will take place.
The Treasury will offer the two-year notes tomorrow, Hanoi Securities Trading said in the statement Tuesday.
The State Treasury on September 18 failed to sell VND1 trillion of two- and three-year notes because bids didn’t meet the reserve prices, the securities-trading center said on its website.
Thanhnien
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