Review of economic information for the week of April 21-26

Economic news review

Overview

The government bond market was vibrant in the first quarter of 2025 and is expected to continue this trend in the second quarter, effectively mobilizing capital for development investment.

According to the Ministry of Finance , in the first quarter of 2025, the State Treasury mobilized a total volume of VND 110,440 billion of government bonds, equal to 99.5% of the plan assigned by the Ministry of Finance in the first quarter of 2025 (VND 111,000 billion) and 22.1% of the plan for 2025 (VND 500,000 billion). The maturity of government bonds issued ranges from 5 to 30 years, focusing mainly on the terms of 5, 10 and 15 years with a proportion of 98.4% of the total issuance volume to the market. The average issuance term in the first 3 months of the year was 10.23 years, in line with the target set out in Resolution No. 23/2021/QH15 dated July 28, 2021 of the National Assembly on the national financial plan and borrowing and repayment of public debt for the 5-year period 2021-2025. Thereby, maintaining the average maturity of the entire government bond portfolio at 8.95 years, contributing to restructuring the government bond debt portfolio, reducing short-term debt repayment pressure for the central budget.

The winning interest rate of government bonds has gradually increased by 0.06-0.19%/year, averaging 2.91%/year in the first 3 months of 2025. In fact, the State Treasury has accelerated mobilization from issuing government bonds, while simultaneously pushing up the bid interest rate to attract bidding activities. This move is likely to continue in the context of less favorable international conditions, making public investment an important driving force to achieve the economic growth target of 8% in 2025 when recording a record high development investment plan of up to VND 888 trillion.

The winning rate of government bonds in the first quarter reached 69%, much higher than previous quarters, also showing the revival of the primary market. The data also shows that the demand for government bond investment increased sharply in March when the amount of government bonds won in this month alone accounted for more than 59% of the total amount of government bonds won in the first quarter. However, the demand for investment in government bonds mainly came from the Social Insurance, while from credit institutions it was still relatively weak.

More specifically, as of April 15, the government bond portfolio of the entire credit institution system increased by only VND16,000 billion compared to the beginning of the year, while investment in credit institution bonds increased by VND97,000 billion. It can be seen that the trend of increasing investment in credit institution bonds is still strong, government bonds are less noticeable, especially when the money market interest rate is still at a relatively high level. If the money market conditions are loosened, interest rates and government bond yields may temporarily decrease slightly before facing greater pressure in the final months of the year.

The State Treasury has also announced the plan to auction government bonds in the second quarter of 2025. Specifically, the total expected issuance volume is VND120,000 billion, of which VND18,000 billion is for a 5-year term, VND2,000 billion is for a 7-year term, VND70,000 billion is for a 10-year term, VND25,000 billion is for a 15-year term, VND2,000 billion is for a 20-year term and VND3,000 billion is for a 30-year term. From April 1 to 25, the State Treasury has mobilized more than VND32,300 billion/VND52,000 billion of government bonds called for bid through 4 auctions.

Domestic market summary week from April 21-26

In the foreign exchange market from April 21 to 26, the central exchange rate was generally adjusted by the State Bank in an upward trend. At the end of April 26, the central exchange rate was listed at 24,963 VND/USD, a sharp increase of 65 VND compared to the previous weekend session.

The USD buying price is listed at 23,765 VND/USD, 50 VND higher than the floor rate; while the USD selling price is listed at 26,161 VND/USD, 50 VND lower than the ceiling rate.

The interbank USD-VND exchange rate fluctuated between April 21 and 26. At the end of the session on April 26, the interbank exchange rate closed at 26,020, up 70 VND compared to the previous weekend session.

The dollar-dong exchange rate on the free market increased slightly last week. At the close of the session on April 26, the free exchange rate increased by 95 VND in both buying and selling directions compared to the previous weekend session, trading at 26,380 VND/USD and 26,480 VND/USD.

In the interbank money market from April 21 to 26, interbank VND interest rates for terms of 1 month or less decreased in most sessions. Closing on April 26, interbank VND interest rates were traded at: overnight 2.53% (-1.65 percentage points); 1 week 4.23% (-0.13 percentage points); 2 weeks 4.35% (-0.19 percentage points); 1 month 4.53% (-0.07 percentage points).

Interbank USD interest rates fluctuated slightly across all terms last week. On April 26, interbank USD interest rates were: overnight 4.30% (-0.01 percentage point); 1 week 4.36% (+0.01 percentage point); 2 weeks 4.40% (unchanged) and 1 month 4.45% (unchanged).

In the open market from April 21-26, in the mortgage channel, the State Bank offered VND168,000 billion for terms of 7 days, 9 days, 14 days, 16 days, 21 days, 30 days, 35 days, 90 days and 91 days, with interest rates kept at 4.0%. VND42,460.33 billion was won in the bid; VND62,184.98 billion matured last week in the mortgage channel.

The State Bank continues not to bid for State Bank bills.

Thus, the State Bank of Vietnam has withdrawn a net VND19,724.65 billion from the market last week through the open market channel. There are VND90,785.35 billion circulating on the mortgage channel.

On the bond market on April 23, the State Treasury successfully bid VND8,357 billion/VND12,500 billion of government bonds called for bid (winning rate reached 67%). Of which, the 5-year and 15-year terms mobilized the entire bid volume, respectively VND2,000 billion and VND1,000 billion. The 10-year term mobilized VND5,305 billion/VND9,000 billion called for bid and the 30-year term mobilized VND52 billion/VND500 billion called for bid. The winning interest rate for the 5-year term was 2.26% (+0.11 percentage points compared to the previous auction), the 10-year term was 3.03% (+0.03 percentage points), the 15-year term was 3.10% (+0.02 percentage points) and the 30-year term was 3.28% (unchanged).

On April 29, the State Treasury plans to bid for VND12,000 billion in government bonds, of which VND5,000 billion will be offered for 5-year terms, VND6,000 billion for 10-year terms, and VND500 billion for 15-year and 30-year terms.

The average value of Outright and Repos transactions in the secondary market last week reached VND14,500 billion/session, a slight increase compared to VND12,995 billion/session of the previous week. Government bond yields last week increased slightly for terms of 5 years or more. At the close of the session on April 25, government bond yields were trading around 1 year 2.08% (unchanged compared to the session at the end of last week); 2 years 2.11% (unchanged); 3 years 2.17% (unchanged); 5 years 2.41% (+0.02 percentage points); 7 years 2.77% (+0.04 percentage points); 10 years 3.07% (+0.03 percentage points); 15 years 3.22% (+0.02 percentage points); 30 years 3.43% (+0.002 percentage points).

Stock market from April 21-26, VN-Index decreased in the first 2 sessions of the week then reversed and increased in the last 3 sessions of the week. At the end of the session on April 25, VN-Index stood at 1,229.23 points, up 22.16 points (+0.83%) compared to the previous weekend; HNX-Index decreased 1.38 points (-0.65%) to 211.72 points; UPCoM-Index increased 0.97 points (+1.06%) to 92.27 points.

Average market liquidity reached over VND23,000 billion/session, down from VND26,000 billion/session the previous week. Foreign investors continued to net sell nearly VND960 billion on all three exchanges.

International News

On April 22, the IMF released a report forecasting the world economy to grow by 2.8% in 2025 (-0.5 percentage points compared to the January forecast). For developed countries, the US is forecast to grow by 1.8% (-0.9 percentage points), the Eurozone by 0.8% (-0.2 percentage points), Japan by 0.6% (-0.5 percentage points) and the UK by 1.1% (-0.5 percentage points).

In developing countries, China is forecast to grow 4.0% (-0.6 percentage points), India to grow 6.2% (-0.3 percentage points) and the ASEAN5 group (Indonesia, Malaysia, Philippines, Singapore and Thailand) to grow 4.0% (-0.6 percentage points).

In addition, the IMF forecasts that global trade value will increase by only 1.7% this year (-1.5 percentage points) and average oil prices will decrease by about $15.5/barrel compared to 2024. The global consumer price index will increase by about 4.3% (+0.1 percentage points), with developed countries increasing by 2.5% (+0.4 percentage points) and developing countries increasing by 5.5% (-0.1 percentage points).

In the short term, the impact of tariffs will vary across countries, depending on their trade relationships, industrial structures, retaliation and trade diversification opportunities, according to the IMF. In the eurozone, China and some other Asian countries, fiscal support and loose monetary policies will offset some of the negative impact of tariffs. However, if inflation returns and persists, central banks will change course, and economies will face more difficulties, especially in emerging markets.

The US recorded some notable economic indicators last week. First, the US manufacturing PMI was 50.7 in April, up from 50.2 in March and against the forecast of a drop to 49.2. However, the services PMI fell to 51.4 in April from 54.4 in the previous month, below the forecast of 52.8.

Next, core durable goods orders in the U.S. were flat in March after rising 0.7% in the previous month, against expectations for a 0.3% increase. However, overall durable goods orders rose 9.2% month-over-month last month, up from February’s 0.9% gain and well above expectations for a 2.1% gain.

In the real estate sector, sales of existing homes in the US reached 4.02 million units in March, lower than the 4.27 million units in February and also lower than the forecast of 4.14 million units.

In the labor market, initial jobless claims for the week ending April 19 were 222,000, up slightly from 216,000 the previous week and in line with forecasts. The four-week average was 220,500, up slightly by 0.75 thousand from the previous four weeks.

Finally, the US consumer confidence index surveyed by the University of Michigan was adjusted to 52.2 points in April, higher than the 50.8 points in the preliminary survey, and at the same time higher than the forecast of 50.6 points.

This week, the market awaits a detailed report on the US economy in the first quarter, in addition to the March core PCE price index and a detailed report on the April labor market. This important information is announced right before the US Federal Reserve (Fed) meeting on May 6 and 7.

Source: https://thoibaonganhang.vn/diem-lai-thong-tin-kinh-te-tuan-tu-21-264-163449.html