Vietnam to cut interest rates 0.7% in ’25

Vietnam is poised to continue its accommodative monetary policy in 2025, with interest rates projected to be 0.7 percentage points lower, according to Vietnam News.

Economist Nguyen Xuan Thanh forecasts that Vietnam will maintain a loose monetary policy to support growth next year, following the trend of interest rate cuts by the US Federal Reserve and other central banks.

Meanwhile, Tran Ngoc Bau, general director of WiGroup, expects Vietnam to have flexibility in easing monetary policies in 2025 as inflation and exchange rates stabilise.

Additionally, Nguyen Ba Hung, chief economist of the Asian Development Bank (ADB) in Vietnam, noted that the central bank’s ability to implement a supportive monetary policy has been greatly restricted despite its ongoing efforts. He emphasised the need for complementary fiscal policy measures, increased public investment disbursement, and state management reforms to alleviate the economic burden.

The central bank’s deputy governor, Dao Minh Tu, recently stated that the bank has not yet decided whether to maintain the current interest rate or reduce it to support the economy. The decision will be made in the near future, taking into account factors such as inflation, growth, and exchange rates.

Attribution: Xinhua

Subediting: Y.Yasser