Vietnam Bonds Have Best Week Since June 2009 On Interbank Rates

Vietnam’s five-year bonds had the best week since June 2009 on speculation a decline in money- market rates bolstered demand for government debt. The dong was little changed.

The overnight interbank deposit rate declined 43 basis points this week to 1.92 percent, the lowest level since June 2009 when Bloomberg started compiling the data. The measure was at 11.8 percent at the end of 2011.

“Interbank rates have dropped sharply, signaling banks have surplus cash to invest in government notes,” said Tran Thi Ngoc Thanh, deputy manager of the investment-banking division at Sacombank Securities Joint-Stock Co. in HCM City. “Demand for bonds has increased, but supply has dropped.”

The yield on five-year bonds fell 13 basis points, or 0.13 percentage point, to 9.5 percent this week, the lowest level since June 2009, according to a daily fixing from banks compiled by Bloomberg. It was unchanged today.

The dong traded at 20,850 per dollar as of 3:05 p.m. in Hanoi, after closing yesterday at 20,848, according to data compiled by Bloomberg. The central bank set the currency’s reference rate at 20,828, unchanged since December 26, its website showed. The currency is allowed to trade as much as 1 percent on either side of the official fixing.

 

Category: Finance