HANOI Jan 21 Vietnam bonds climbed on Tuesday,
driving yields to their lowest in more than six months as demand
for bonds increased on low inflation and solid liquidity in
banks, analysts said.
The yield for government bonds on one-year terms
fell 0.0917 point to 6.025 percent, the lowest since July 4,
2013, according to Reuters fixing data.
The three-year bond yield was down 0.0625 point
to 7.1625 percent, also a low of more than half a year.
Inflation in January is expected to be low this month,
analysts said. Vietcombank Securities estimated January's
consumer price index to rise 0.9-1 percent from last month, or
5.7-5.8 percent yearly.
The central bank has been injecting money into the open
market, keeping liquidity at a sufficient level prior to the
Lunar New Year holiday, when cash is in high demand, said
analyst Van Anh at Vietcombank Securities.
Liquidity would also be boosted later this month as 61.8
trillion dong ($2.9 billion) worth of bonds and bills reach
their maturity dates, Van Anh said.
Credit lending tends to be low in the first quarter of the
year, so banks would invest more in other markets, including
bonds, said Nguyen Duy Phong at Viet Capital Securities.
The State Treasury and banks last week sold $405 million
worth of bonds, or 94 percent of those on offer.
The Asian Development Bank in November said Vietnam was the
fastest growing bond market in emerging East Asia, expanding
18.8 percent year on year at $25 billion. Government bonds grew
24.8 percent to $24 billion, it said in a report.
($1 = 21,060 dong)
(Reporting by Mai Nguyen; Editing by Martin Petty)