Vietnam’s credit growth for the first quarter of 2024 was just 1 percent, according to Deputy Governor of the State Bank, Dao Minh Tu, and reported by VN Express. This is a far cry from where it was at the same time last year–2.56 percent–and does not bode well for the State Bank’s target of 15 percent credit growth for the year.
Of note, Truong Van Phuoc, former acting Chairman of the National Financial Supervisory Commission, is quoted in this article as saying:
“We absolutely do not make the trade-off of pushing interest rates higher to maintain exchange rates, because that is the most expensive trade-off.”
If this is to be the case, that only really leaves treasury bills and foreign currency reserves in the State Bank’s exchange rate management tool kit.