The headquarters of the State Bank of Việt Nam in Hà Nội. — VNA/VNS Photo

HÀ NỘI — The State Bank of Việt Nam (SBV) continued its net liquidity injection in the first two trading sessions of the Year of the Snake on February 3 and 4, pumping over VNĐ35 trillion (US$1.4 billion) into the market.

The central bank injected amounts over VNĐ11 trillion on February 3 and VNĐ24.67 trillion on February 4.

In the latest session on February 4, through the open market operations (OMO) channel, the SBV provided loans to seven financial institutions, totalling over VNĐ10 trillion at an interest rate of 4 per cent per annum for a seven-day term.

Another 12 institutions borrowed VNĐ20 trillion at the same interest rate for a 14-day term. With VNĐ9.25 trillion maturing on the same day, the net injection via this channel amounted to VNĐ21 trillion.

In the treasury bill (T-bill) market, the SBV also issued an additional VNĐ900 billion worth of T-bills with a seven-day maturity at an interest rate of 4 per cent per annum, with two institutions winning the bids. Meanwhile, VNĐ4.55 trillion worth of T-bills matured, resulting in a net injection of VNĐ3.65 trillion.

As of February 4, the total outstanding T-bills in circulation stood at VNĐ24 trillion, while the OMO balance exceeded VNĐ163.5 trillion.

The central bank’s liquidity injections come as interbank interest rates surged in recent sessions. According to the latest data from the SBV, the overnight interbank lending rate on February 3 — the first trading day of the Lunar New Year — stood at 4.75 per cent per annum, an increase of 0.83 percentage points compared to the final session before the holiday on January 24.

Financial market summary

According to the New York branch of the US Federal Reserve, the spread between the US secured overnight financing rate and Việt Nam’s overnight interbank rate currently stands at 0.4 percentage points.

Interest rates for one-week, two-week and three-month tenors have also increased slightly since January 24, reaching 4.98 per cent, 5 per cent and 5.75 per cent, respectively.

In the foreign exchange market, the USD/VNĐ interbank exchange rate closed at 25,085 before the Lunar New Year holiday. Ongoing US-China trade tensions could influence market movements this week. Asia Commercial Bank forecasts that the USD/VNĐ exchange rate may rise to 25,400 in the first half of February.

Meanwhile, United Overseas Bank (UOB) expects continued pressure on the Vietnamese đồng due to US tariff policies and movements in the Chinese yuan, predicting the exchange rate could reach 25,800 in Q1 and 26,200 in Q3 of 2025.

UOB assesses that the need for monetary easing to support economic growth is no longer urgent. Throughout 2024, the SBV maintained a low-interest-rate environment, primarily intervening through OMO and T-bill issuance to ensure liquidity. The likelihood of the SBV raising its policy rates remains very low. — VNS