Economics
Vietnam's Rate Cut May Spur Growth Amid Credit Worries
- Central bank reduced refinancing, discount rates by 25 bps
- IMF said last week Vietnam must contain rapid credit growth
Motorcyclists travel along a road during sunset in Ho Chi Minh City, Vietnam, on Tuesday, Jan. 10, 2017. Vietnam's economy expanded more than 6 percent for a second year in 2016, defying a regional slowdown to remain one of the world's best performers as retails sales rose 10.2 percent.
Photographer: Linh Luong Thai/BloombergThis article is for subscribers only.
Vietnam’s surprise lowering of interest rates for the first time in three years may help to support economic growth, but raises credit risks in a nation still grappling with a hangover of bad debt.
The central bank reduced the refinance rate by 25 basis points to 6.25 percent late on Friday and also lowered the discount rate to 4.25 percent from 4.5 percent. The changes come into effect on Monday, the State Bank of Vietnam said on its website.