Interest rates for corporate loans at 6-9pct appropriate

12-Jul-2018 Intellasia | BizLive | 6:02 AM Print This Post

At the scientific forum about Vietnam macroeconomic report in 2018 namely “Preparing for shocks Maintaining macroeconomic stability” organised by the Banking University of HCM City (BUH) in the city on July 9, 2018, Ass.Pro.Dr Nguyen Duc Trung, vice President of BUH and research team said the GDP growth rate in the remaining two quarters of 2018 is hard to be as satisfactory as in 2017. Therefore, the GDP in 2018 is forecasted at about 6.7 percent.

Vietnam’s GDP growth rate in Q2/2018 reached 6.79 percent, bringing the GDP growth in the first six months of 2018 to 7.08 percent, which is the highest growth rate in six months since 2011. Vietnam had three quarters whose growth exceeded the potential output.

However, with the unexpected increase in inflation in June within seven recent years driven by push costs, i.e. the strong increase of petrol price to nearly 14 percent, inflation has improved 4.67 percent compared to the same period of 2017 and 2.22 percent from the end of 2017.

Monetary policy of the State Bank aims at supporting economic growth. Therefore, the State Bank is maintaining low lending rates. If controlling 2018 credit growth rate at 15-17 percent, the difference in credit growth and GDP will be 4-6 percent, a reasonable level for a developing economy that relies much on capital like Vietnam.

The research team also calculates lending rate payment ability of businesses on the stock exchange, showing that the interest rates of 6-9 percent are suitable.

In 2017, Vietnam was in Top 3 most stable currencies in Asia. In the first half of 2018, the exchange rate was adjusted flexibly, in line with the neutrality of foreign currency flows, ensuring the equilibrium of exchange rate.

Therefore, the research team forecasts the GDP growth in 2018 at 6.7-7 percent, inflation at 3.6-4 percent, the state budget deficit against GDP at about 3.7-4 percent; the overall balance of payment at $8-10 billion.


Category: Stocks, Vietnam

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