HCMC – As interbank interest rates have continued to cool down, the central bank has withdrawn more money from the banking system.
Baoviet Securities Company (BVSC) said in a recent report that interbank interest rates have continued decreasing. The overnight rate dropped 87 basis points and the one-week rate slid 80 basis points.
The central bank issued treasury bills amounting to VND103 trillion, with terms of one, two and four weeks, and sold U.S dollars in its foreign exchange reserves, SSI reported. The move helped the Vietnamese dong maintain stability against the U.S. dollar.
Meanwhile, the central bank pumped nearly VND1.6 trillion for a seven-day term at an interest rate of 3.5% into open market operations, in which some VND7.7 trillion of the seven-day term in the market fell due.
According to BVSC, the central bank withdrew a net total of over VND88 trillion from the open market and treasury bill issuance, the highest net withdrawal since 2019.
“The strong withdrawal last week showed interbank interest rates have not fallen deeper,” BVSC analysts said.
Earlier, interbank interest rates fell by over 170 basis points, as the bank net injected VND34 trillion into the market.
Over the past two months, banks’ liquidity faced lower pressure from rapid credit growth.
Last week, the Vietnamese dong remained stable though the U.S dollar rose. The interbank interest yield curve flattened, with the Vietnam exchange rate against the U.S dollar standing at VND23,393.
The pressure on the Vietnamese dong was still high, as treasury bills falling due this week reached VND71 trillion, SSI analysts said, adding that they expected the central bank to continue issuing treasury bills and selling dollars to keep interbank interest rates at reasonable levels.