Vietnam Bonds Decline as Rate Cut Seen Unlikely; Dong Steady

Vietnamese government bonds fell, pushing the five-year yield to the highest level since May, on speculation accelerating inflation will deter policy makers from cutting interest rates. The dong was little changed.

The securities declined for a third day after Finance Minister Vuong Dinh Hue said in a televised interview posted on the government’s website last night that authorities will try to keep consumer-price gains under 10 percent for the rest of the year. Inflation quickened to 6.48 percent in September, the fastest pace since June, official data show.

The “chance is low” for an interest-rate cut before year- end, Pham Luu Hung, an analyst at Saigon Securities in Hanoi, wrote in a research note released today.

The five-year bond yield climbed three basis points, or 0.03 percentage point, to 10.35 percent, according to a daily fixing from banks compiled by Bloomberg. That was the highest level since May 3.

The dong traded at 20,853 per dollar as of 3:53 p.m. in Hanoi, compared with 20,855 at the end of last week, according to data compiled by Bloomberg. The central bank set its daily reference rate at 20,828, unchanged since Dec. 26, according to its website. The currency is allowed to trade as much as 1 percent on either side of the fixing.

To contact Bloomberg News staff for this story: Nguyen Dieu Tu Uyen in Hanoi at

To contact the editor responsible for this story: James Regan at

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.