T-bill bidding interest rates, interbank interest rates and deposit interest rates at commercial banks are all increasing again in the context of the VND/USD exchange rate continuously reaching new peaks. These are the factors that will cause lending interest rates to increase soon?
On the afternoon of April 15, the State Bank (SBV) announced information about the bidding results on the open market. Accordingly, the State Bank bought VND 12,000 billion of 7-day treasury bills with a winning interest rate of 4%. At the same time, the operator also sold 2,800 billion VND of 28-day T-bills, winning interest rate of 3.59%.
With the above volume, in total, the State Bank has injected a net VND 9,200 billion into the market to solve the short-term liquidity shortage.
Since the beginning of April, more than 171,000 billion VND has been withdrawn by the State Bank through the bill channel. This is the amount of T-bills issued during the period March 11-April 1.
Open market bidding results on April 15.
This move by the State Bank is considered by observers to be a timely response in the context of excess liquidity in the system, especially after the VND/USD exchange rate set a new peak, exceeding the 25,000 VND/USD mark.
Interbank interest rates also increased again. The current overnight interest rate is at 4.18%/year (an increase of nearly 3%/year compared to 1 month ago), narrowing the interest rate difference between VND and USD.
With the interest rate on T-bills sold for a 28-day term of 3.59%, it is clear that T-bill interest rates are increasing again, from 1.4% in mid-March 2024, then increasing to 1.7%. , then 2.5%. The interest rate on sold bills reached 3.5%/year in the April 12 session and is now 3.59%/year.
The interest rate for buying treasury bills of the State Bank also increased accordingly when the 7-day term had an interest rate of up to 4%/year in the April 15 session. This interest rate has been maintained since the bill auction on April 12 with the winning volume of 8.6 trillion VND.
Regarding exchange rate developments, at the beginning of the trading session on April 16, the State Bank announced that the central exchange rate of Vietnamese Dong to USD increased by 14 VND, currently at 24,096 VND.
The reference exchange rate at the State Bank’s Buying – Selling Exchange increased slightly, currently at: 23,400 VND – 25,250 VND.
At commercial banks, selling rates continue to be at historic peaks. At Vietcombank it is 25,300 VND/USD, at VietinBank it is 25,301 VND/USD, and at BIDV it is 25,299 VND/USD.
In the bank deposit interest rate market, “giant” VietinBank this morning (April 16) just made a new move by increasing 0.2 percentage points of deposit interest rates for terms from 1-11 months and from 24-36 months. Currently, the highest deposit interest rate at VietinBank is up to 5%/year.
Previously, 6 commercial banks increased deposit interest rates since the beginning of April. Increased deposit interest rates will lead to increased lending interest rates.