Vietnam Macro Update

03.10.2016

GDP – 6.0% to 6.3%
– Q3 GDP growth came in at 6.4% YOY (vs. 5.5% and 5.8% in Q1 and Q2 respectively)
– Agriculture, which suffered in Q1 and Q2 due to droughts, was back up 0.65% this quarter
– FY2016 targets – Viet Cap 6.3%, ADB 6.0%, HSBC – 6.3%, CBR Investment AG & VNHAM 6.3%

CPI up 3.34% YOY
– 3.34% YOY with Sept up 0.54% MoM
– Everything is up, but especially education (gov is reducing subsidies), and petrol

Credit growth to accelerate in 1H
– At 10.5% YTD, credit growth should accelerate in Q4 2016 to reach the 18% target by the SBV
– This may tighten bank liquidity, and thus weakening bond demand
– 5Y government bond yields sharply declined from mid-August, now 5.14%, in VND

FX reserves up to $40bn
– Estimated at $40bn from $30bn early this year

FDI disbursements +12.4% YOY
+12.4% YOY to $11bn YTD

PMI at 52.9 – 16-month high in Sept

Source; MOF, Brokers,

Photo: CBR Investment AG