Bloomberg News

Vietnam Bonds Rise After Yields Decline at Auction; Dong Steady

July 20, 2012

Vietnam’s benchmark five-year bonds rose the most in two months after yields fell at a debt auction yesterday. The dong weakened.

The State Treasury sold 1.3 trillion dong ($62.4 million) of the 2 trillion dong of five-year notes on offer at a yield of 9.88 percent, according to the Hanoi Stock Exchange. At the last sale on July 12, it issued 500 billion dong of similar-maturity securities at 9.9 percent, compared with the 2 trillion dong available.

“The actual yield at auction, and the amount sold at the auction, implies that investors have come back to the market,” said Tran Kieu Hung, a Hanoi-based fixed-income trader at Bank for Investment & Development of Vietnam.

The yield on five-year bonds fell 15 basis points, or 0.15 percentage point, to 9.95 percent in Hanoi, according to a daily fixing from banks compiled by Bloomberg. That’s the biggest drop since May 10. Yields fell 12 basis points this week, the most since the period ended June 8.

The dong traded at 20,850 per dollar as of 3:23 p.m. in Hanoi, compared with 20,843 yesterday, according to data compiled by Bloomberg. The currency strengthened 0.1 percent from July 13.

The State Bank of Vietnam set its 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.

To contact the reporter on this story: Nick Heath in Hanoi at nheath2@bloomberg.net

To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net


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