Foreign Exchange Market:
On August 12, the State Bank set the central exchange rate at VND 24,256/USD, a decrease of 4 VND compared to the end of last week’s session. The spot buying and selling rates remained stable at VND 23,400/USD and VND 25,450/USD, respectively. In the interbank market, the closing rate was VND 25,130/USD, an increase of 25 VND from August 9. On the free market, the exchange rate fell sharply, with the buying rate dropping by 125 VND and the selling rate by 195 VND, trading at VND 25,540/USD and VND 25,640/USD.
Interbank Money Market:
On August 12, the average offering interest rates in the Interbank VND market remained unchanged for overnight (ON) terms but saw a decrease of 0.03 – 0.06 points across other terms up to 1 month, with rates as follows: ON at 4.40%, 1-week at 4.50%, 2-weeks at 4.62%, and 1-month at 4.74%. The Interbank USD offering rates remained steady for ON and 1-month terms, while the 1-week and 2-week terms saw a slight decrease of 0.01 points, trading at: ON 5.30%, 1-week 5.34%, 2-weeks 5.39%, and 1-month 5.43%. In the secondary government bond market, yields remained stable for 3-year and 15-year terms but decreased for other maturities, closing at: 3-year 1.91%, 5-year 1.96%, 7-year 2.25%, 10-year 2.73%, and 15-year 2.92%.
Open Market Operations:
The State Bank of Vietnam (SBV) offered VND 7,000 billion on the mortgage channel with a 7-day term and an interest rate of 4.25%, with VND 6,999.99 billion successfully bid and VND 13,668.54 billion maturing. The SBV also issued 14-day bills, bidding at an interest rate of 4.25%, with VND 8,100 billion successfully bid and VND 10,850 billion maturing. As a result, the SBV withdrew a net amount of VND 3,918.55 billion from the market through open market operations. The total volume of bills circulating in the market stood at VND 94,299.5 billion, while the mortgage channel had VND 49,949.01 billion in circulation.
Stock Market:
The stock market saw fluctuations yesterday but ended on a positive note as buying pressure returned, boosting indices. The VN-Index rose by 6.64 points (+0.54%) to 1,230.28 points, the HNX-Index gained 1.39 points (+0.61%) to 230.77 points, and the UPCoM-Index increased by 0.20 points (+0.22%) to 93.0 points. Market liquidity was low, with a trading value exceeding VND 15,400 billion. Foreign investors were net buyers with less than VND 45 billion across all three exchanges. According to the Vietnam Bond Market Association (VBMA), July 2024 saw 33 private corporate bond issuances totaling VND 31,387 billion and 1 public issuance worth VND 395 billion. Over the first 7 months of 2024, there were 175 private issuances worth VND 168,433 billion and 12 public issuances worth VND 14,586 billion. In July, companies repurchased VND 32,094 billion in bonds before maturity, marking a 17% increase from the same period in 2023. For the remainder of 2024, approximately VND 121,854 billion in bonds are expected to mature, with real estate bonds making up the largest share at VND 51,603 billion, or 42%.
International News:
A recent report from UBS Bank (Switzerland) using data up to July suggests that the probability of a recession in the US is now at 53%, down from 60% a few months ago. However, UBS emphasized that although the recession risk is decreasing, the US economy is still weakening, with growth expected to slow from around 3% in 2023 to 1.5% this year.
The German Federal Statistical Office (Destatis) reported that the country’s Wholesale Price Index (WPI) increased by 0.3% month-over-month in July, following a 0.3% decline in the previous month, surpassing the forecasted 0.2% rise. Year-over-year, the WPI in Germany saw a slight decrease of 0.1% compared to the same period in 2023.
Exchange Rate on August 12:
• USD = 0.915 EUR (-0.14% day/day); EUR = 1.093 USD (+0.14% day/day)
• USD = 0.783 GBP (-0.04% day/day); GBP = 1.276 USD (+0.04% day/day)
• GBP = 1.168 EUR (-0.10% day/day); EUR = 0.856 GBP (+0.10% day/day)
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Source: Vietnam Insider