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Five-year bonds drop on dollar-debt sale; dong weakens
Five-year bonds fell on speculation investors will save cash to buy the country’s dollar-denominated debt at a planned sale this year. The dong slipped.
The Southeast Asian country plans to sell US$1 billion of US currency bonds in the domestic market to fund a budget shortfall, according to a statement on the government’s website, citing Prime Minister Nguyen Tan Dung.
Vietnam raised $230 million from three such auctions in March.
“The dollar-bond sale is expected to be very attractive and investors, especially foreigners will save money to buy the debt,” said Giang Trung Kien, head of investment analysis at Hanoi-based FPT Securities Joint Stock Co.
The yield on the benchmark five-year note climbed two basis points to 9.24 percent, according to a daily fixing price from about 10 banks compiled by Bloomberg. A basis point is 0.01 percentage point.
The Vietnamese dong declined to VND17,800 per dollar as of 2:18 p.m. in Hanoi, from VND17,793 on Tuesday, according to data compiled by Bloomberg.
The State Bank of Vietnam fixed the reference rate at VND16,952 per dollar Wednesday, compared with VND16,950 on Tuesday, according to its website. The currency is allowed to move up to 5 percent on either side of the fixed rate.
thanhnien, Bloomberg
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