Bloomberg News

Vietnam’s Bonds in Record Rally on Bank Purchases; Dong Gains

May 03, 2012

Vietnam’s benchmark bonds rallied for a 12th day, the longest run of gains in data going back to July 2006, on speculation banks are boosting holdings of the securities. The dong strengthened.

“Banks have bought more bonds since they have surplus cash,” said Nguyen Thi Ngoc Anh, the Ho Chi Minh City-based head of fixed-income trading at Asia Commercial Bank. (ACB) “Declines in overnight interest rates in the money-market showed liquidity has increased at banks.”

The overnight interbank deposit fixing dropped 12 basis points, or 0.12 percentage point, to 4.54 percent, according to data compiled by Bloomberg. The rate has tumbled 727 basis points this year.

The yield on the benchmark five-year bond declined eight basis points today to 10.50 percent, according to a daily fixing from banks compiled by Bloomberg. That was the lowest level since November 2010. Three-year yields slid nine basis points to 10.46 percent.

The dong appreciated 0.1 percent to 20,845 per dollar as of 4 p.m. in Hanoi, according to prices from banks compiled by Bloomberg. The central bank fixed the reference rate at 20,828, unchanged since Dec. 26, according to its website. The currency is allowed to trade up to 1 percent on either side of the rate.

--Nguyen Dieu Tu Uyen. Editor: James Regan

To contact the reporters on this story: Nguyen Dieu Tu Uyen in Hanoi at

To contact the editor responsible for this story: Sandy Hendry at

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