The State Bank of Vietnam (SBV) late last week announced its first interest rate cut in the open market operation (OMO) in the past five years.
Unilever and P&G alone hold up to 80% of the domestic detergent market, pocketing huge profits. With revenue of US$600-650 million a year and growth rate of 10%, the Vietnamese detergent market is very attractive to manufacturers.
The money market has been seeing unexpected happenings in the last two weeks. Until two weeks ago, the liquidity of the banking system had been in a state of tension because lending was higher than mobilized capital.
Since mid-February interest rates on Vietnam dong loans on the inter-bank market have surged, somewhat surprising analysts since liquidity at most banks is pretty steady.
The State Bank of Vietnam has targeted keeping interest rate stable in 2017, however, the market’s developments in the first half of January 2017 show that lending rates are suffering from many pressures.
Following the continuous decline over the past weeks, inter-bank rates across all tenors hit a record low, staying at below 1% per year.
Many manufacturing enterprises have lost their brands and the market, becoming outsourced workshops for retailers.
Lending by banks has been accelerating, growing at 18.2% in the year-to-date compared to the same period last year, according to HSBC's monthly report Vietnam at a Glance released on October 2.
Deposit interest rates are set to fall across the board for the local banking sector, including a prediction that there should be a cut in a open-market operations interest rates to at least 4.5 % a year by the end of 2015.
(VOV) - Vietnam’s GPD will continue to grow despite low credit growth, according to recent HSBC’s report on Vietnam at a glance.
(VOV) -The February consumer price index (CPI) slowed to a five-year low following the Lunar New Year, which historically has driven prices up, reports Hong Kong and Shanghai Banking Corporation (HSBC).
Interest rates for short-term deposits had remained high for a long time before being adjusted lower than those for medium- and long-term ones.