Oct 01, 2018 / 08:08
Vietnam has much monetary policy room to boost growth till year-end
The credit growth target has been set at 17% this year, meaning that credit can grow an additional 6-7% in the final three months.
The Vietnamese government has much room left to maneuver its monetary policy from now to the year-end to spur economic growth while putting an eye on rising inflation.
Official data showed that total lending in the banking system expanded 9.52% year to September 20, lower than an 11.02% expansion in the same period last year. The credit growth target has been set at 17% this year, meaning that credit can grow an additional 6-7% in the final three months.
Total outstanding loans in the banking system rose 7.86% in the first half this year, reaching VND6,827 trillion dong (US$291 billion), according to data of the State Bank of Vietnam (SBV), the country’s central bank.
Meanwhile, the total money supply increased 8.74% year to September 20, slower than a 9.59% expansion in the comparable period last year. Deposits at banks grew 9.15% in the nine-month period, also slowing down from a 10.08% increase a year earlier.
The SBV has stated it would stick to a policy to rein credit growth from now to the year-end, stressing that it would not loosen the credit growth quota for any commercial banks although many lenders have seen their lending room running up.
The Asian Development Bank said in an update last week that going forward, the SBV intends to pursue a more flexible exchange rate regime with the ultimate objective of gradually shifting its monetary policy framework from focusing on exchange rate stabilization and monetary-credit targeting to inflation targeting.
“Building on these recent measures and future policy intentions, there is merit in a tighter monetary policy in the near term to rein in inflation,” ADB noted.
Vietnam’s economic growth hit an eight-year high of 6.98% in the first three quarters this year, above the government’s target of 6.7% for the whole year.
Photo: Quang Phuc/VnEconomy
|
Total outstanding loans in the banking system rose 7.86% in the first half this year, reaching VND6,827 trillion dong (US$291 billion), according to data of the State Bank of Vietnam (SBV), the country’s central bank.
Meanwhile, the total money supply increased 8.74% year to September 20, slower than a 9.59% expansion in the comparable period last year. Deposits at banks grew 9.15% in the nine-month period, also slowing down from a 10.08% increase a year earlier.
The SBV has stated it would stick to a policy to rein credit growth from now to the year-end, stressing that it would not loosen the credit growth quota for any commercial banks although many lenders have seen their lending room running up.
The Asian Development Bank said in an update last week that going forward, the SBV intends to pursue a more flexible exchange rate regime with the ultimate objective of gradually shifting its monetary policy framework from focusing on exchange rate stabilization and monetary-credit targeting to inflation targeting.
“Building on these recent measures and future policy intentions, there is merit in a tighter monetary policy in the near term to rein in inflation,” ADB noted.
Vietnam’s economic growth hit an eight-year high of 6.98% in the first three quarters this year, above the government’s target of 6.7% for the whole year.
Other News
- Finance ministry clears bottlenecks to pave way for stock market upgrade
- Over 60% of Vietnamese use QR codes to pay
- Casinos contribute US$370 million to state budget over 5 years
- Standard Chartered and IATA partner to launch IATA Pay in Vietnam
- Vietnam’s capital market shows positive signs: Finance Ministry
- Prime Minister urges banks to cut lending rates further
- Potential upgrade to emerging status may pull US$25 billion into Vietnam’s stock market
Trending
-
World Bank looks forward to stronger ties with Vietnam: country director
-
Vietnam news in brief - March 29
-
Hanoi kicks off communication contest on Dien Bien Phu victory
-
French education group Odyssey keen on strengthening cooperation with Hanoi
-
Hanoi, Shanghai strengthen investment cooperation
-
UOB Painting of the Year Award opens doors to the world for Vietnamese artists
-
Grapefruit blossom perfume Hanoi's air
-
MICE tourism: Vietnam's lucrative “golden market” unveiled
-
Vietnam: Sleep Tourism on the rise