According to the monetary market report from June 10-14, 2019 announced by SSI Securities Corporation, last week, the State Bank of Vietnam (SBV) net injected 5.65 trillion dong via matured bills; Open market channel (OMO) did not generate transactions and maintained a zero balance.
Interbank interest rates increased by 0.12 to 0.13 percent point, currently at 3.28 percent per year with overnight rate and 3.4 percent for 1 week term. The overnight interest rate difference of dong and US dollar was 0.83 percent.
Deposit rates of market one were stable at 4.1 percent to 5.5 percent for terms of less than six months; 5.5 percent to 7.45 percent for terms of six to under 12 months and 6.4 percent to 7.8 percent per year for 12 month and 13 month terms. Particularly, some banks with small market shares offered interest rate above eight percent per year.
Credit growth at the end of May 2019 was 5.74 percent, 0.48 percent lower than the same period in 2018. First half of 2018, mobilisation increased on par with credit. However, in the first five months of 2019, deposit growth was always lower than credit.
According to SSI, this showed that the capital mobilisation pressure for commercial banks was still high and the mobilising interest rate would be difficult to reduce, especially in long terms.
SSI said that if interest rates fell, it would be limited to short terms only because interest rate on the interbank were low. On the other hand, commercial banks also wanted to extend the gap between short and long term to create an attractive term, thereby increasing the proportion of medium and long-term capital mobilisation.
On the exchange rate, last week, in the international context, there was no new development, the domestic supply and demand were favourable, making the dong increase quite strongly.
The USD/VND exchange rate decreased by 80 dong per US dollar on the bank to 23.265/23.385 and 80 dong per US dollar on the buying side, 85 dong per US dollar on selling side in the free market, to 23,310/23,330.
Thus, only in the first half of June, the dong increased by 0.4 percent against US dollar, reducing the depreciation of VND from 0.84 percent from the beginning of the year to the end of May to only 0.43 percent. The central exchange rate decreased insignificantly, 1 dong per US dollar, to 23,059 dong per US dollar.
“In fact, the supply of US dollar from the beginning of June has been relatively abundant, the foreign currency status of banks is quite good. The positive movements of FDI capital will be the main factor supporting the USD/VND exchange rate in the future”, SSI commented.
Reportedly, in the first five months of 2019, disbursed FDI reached $7.3 billion, up only 8.1 percent but registered FDI reached $16.7 billion, up 69 percent compared to the same period last year.
