Vietnam c.bank cuts benchmark interest rates by 25 bps
A 0.25% reduction is subject to refinancing interest rate, re-discount interest rate, interest rate applicable to overnight loans, and interest via open market operation (OMO), starting effective since September 16.
The State Bank of Vietnam, Vietnam’s central bank, announced the decision to cut the benchmark interest rates by 25 basis points or 0.25 percentage points amid unfavorable global economic environment and major central banks having cut their respective interest rates.
Illustrative photo.
|
Following the decision, the refinancing interest rate is down from 6.25% per annum to 6%, rediscount rate from 4.25% to 4%, overnight interest rate from 7.25% to 7% and interest rate via OMO from 4.75% to 4.5%.
The move marked the first time since October 2017 that the SBV cut the benchmark interest rate, which is expected to help commercial banks reduce cost for refinancing and re-discount loans from the SBV, in turn partly reducing loan rates.
According to the SBV, the unfavorable global economic environment has led to major central banks, including the Federal Reserves (FED) and the European Central Bank, reduce the benchmark interest rates.
The ECB previously announced to lower its deposit interest rate by 01% to a record low of -0.5%, and is expected to start buying assets worth EUR20 billion (US$22.18 billion), starting November.
Over the past few months, the FED has issued warning that the escalation of trade war and slowdown in global economic growth are potential risks to the US economy. As such, its decision to lower the interest rate by 0.25 percentage point in July was aimed to prevent any shock to the economy and ensure the inflation rate staying below the target.
Analysis predicted FED could cut the interest rate further in the remaining months of 2019, especially when the outlook of the US economy remains dim.
17:51, 2025/01/07
Vietnam prioritizes agriculture and renewable energy for access to green loans
The move is part of the government’s effort to accelerate economic restructuring and build resilience to climate change while protecting the environment.
16:49, 2025/01/06
Vietnam GDP expands by 7.09% in 2024
The 2024 growth rate is considered positive amidst global uncertainties and domestic challenges such as natural disasters.
14:39, 2025/01/04
Vietnam stock market set to accelerate in 2025: Experts
Stable macroeconomic fundamentals, ongoing institutional reforms, and favorable monetary policies will be positive for corporate earnings.
16:31, 2025/01/02
Vietnam stock market aims for emerging status by 2025: Finance minister
By the end of 2024, the benchmark VN-Index reached 1,266.78 points, up 12.11% from 2023.
15:33, 2025/01/02
Vietnam set to extend VAT cut for six months
This measure is expected to accelerate the recovery of production and business activities, which will ultimately benefit the state budget and the economy as a whole.
21:29, 2024/12/31
Vietnam’s credit growth projected to expand by 16% in 2025
Growth must put operational safety first, and channel credit to productive business sectors, priority areas, and growth-driving industries.
- Regional, international financial centers mean boosters to Vietnamese economy: Deputy PM
- IFC sets record with US$1.6 in climate financing to support Vietnam’s green transition
- Vietnam's credit growth up 10% in 10 months
- Building Hanoi's smart city with smart banking
- Vietnam stock market clears major legal hurdle to potential upgrade
- Cashless parking in Hanoi: Good model fuels smart transport