Bonds drop a second day on supply; dong strengthens

The government bonds declined for a second day before a debt auction next week. The dong strengthened at banks after the central bank set a stronger reference rate for trading.

Vietnam Bank for Social Policies, the state-owned lender that raises money for government welfare projects, will sell VND2 trillion (US$113 million) of two-year bonds on April 13, according to a statement e-mailed Tuesday from the Hanoi Securities Trading Center, where the auction will take place.

The yield on the benchmark five-year note climbed four basis points to 9.26 percent as of 4 p.m. Tuesday in Hanoi, according to a daily fixing price from 10 banks compiled by Bloomberg. A basis point is 0.01 percentage point.

The Vietnamese dong rose 0.1 percent to VND17,750 versus the dollar, compared with VND17,784 on April 3, according to data compiled by Bloomberg. The nation’s financial markets were closed on Monday for a holiday. The dong reached a record low of VND17,824 on March 26 after the State Bank of Vietnam widened the daily trading band.

The central bank fixed Tuesday’s reference rate at VND16,940, from VND16,980 on April 3, according to its website. The currency is allowed to trade by as much as 5 percent on either side of the official rate.

thanh nien, bloomberg

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