HCMC – Vietnam raised only VND7.37 trillion from government bond auctions in December 2024, achieving just 22% of the VND34 trillion target, according to the Vietnam State Treasury (VST).
The coupon rate for 10-year G-bonds increased to 2.97% by the end of December, up by 21 basis points against November, reflecting market concerns over inflation and potential interest rate hikes, MB Securities Company reported.
Despite the lower volume of bonds offered for the second consecutive month, the success rate of auctions remained low. Over the course of 2024, the VST issued nearly VND330.4 trillion in G-bonds, meeting 83% of its annual target.
Looking ahead to 2025, the Ministry of Finance has tasked the VST with raising VND500 trillion through G-bond issues, marking a record high and exceeding the previous target of VND400 trillion.
The increased funding is intended to support public investment and help achieve GDP growth targets of 8-10%. To better align with market demand, the VST plans to shift from quarterly to monthly issuance plans.
Bond coupons increased across all terms in December. Five-year bonds reached a coupon rate of 2.06%, while 10-year bonds rose to 2.77%. However, no transactions were recorded for 15-year bonds during the month.
Secondary market activity showed an uptick, with average daily trading value increasing by 9.2% month-on-month to VND14.9 trillion. Newly issued bonds accounted for 76% of total transactions, while buyback activity declined.
Foreign investors contributed to improved market liquidity, purchasing a net VND2.47 trillion in G-bonds during December. This brought total net foreign inflows for 2024 to VND2.65 trillion.
