Q: If I am doing asset allocation in Vietnam, how should I incorporate interest rates and exchange rates into the same decision-making table?

You can use a very practical "four-grid framework":1) Local currency returns (deposits/bonds/rental income): High interest rates do not equal high real returns; inflation must be deducted.2) Exchange direction (VND against USD/CNY): Focus on the exchange rate of your "accounting currency."3) Volatility risk (maximum drawdown): Use the annual high-low range to estimate the potential upper limit of exchange losses.4) Policy changes (SBV, credit targets, real estate support policies): Policies are often 'trigger points for turning points.'After quantifying these four items, you will more easily conclude:- Whether to lean towards "short-duration cash management" or "long-duration asset holding";- Whether to use phased currency exchange to reduce risk or concentrate exchange at key windows.

Question 1

Why do you provide the 'national average range' instead of the specific interest rate of a particular bank?

Accepted Answer

You are focusing on the 'national average interest rate trend,' which is better described using the industry tracking approach.

- The listed interest rate of a single bank is influenced by: bank size, funding gap, promotional strategies, online-exclusive products, deposit amount thresholds (large/small amounts, tiered), cross-selling, etc.
- The industry approach (such as VNBA's monthly tracking of credit institution interest rates) is closer to the 'mainstream market range,' suitable for:
1) Judging tightness/looseness of liquidity,
2) Inferring the direction of loan pricing and asset price discount rates,
3) Providing a more stable comparison benchmark for international investors.

Question 2

What are the levels of current and fixed deposit interest rates in 2025? What are the typical ranges?

Accepted Answer

Taking VNBA's tracking approach for credit institution interest rates in August 2025 as an example:

- Current/demand deposits (including those under 1 month): approximately 0.2% per annum.
- 1 month–6 months: approximately 3.3%–4.1% per annum.
- 6 months–12 months: approximately 4.6%–5.5% per annum.
- 12 months–24 months: approximately 4.9%–6.1% per annum.

> These values are more suitable as the 'market average range/common range.' If you later need to filter products by city or bank, using bank-specific data will be more precise.

Question 3

Why did the market experience 'intensified competition/increase in deposit interest rates' in the latter part of 2025?

Accepted Answer

The logical chain is typically:1) Recovery in credit demand (expectations for real economy financing, project deployment, and some funds entering asset markets) → banks need more funding on the liability side;2) If regulatory targets are raised (e.g., SBV increases credit growth targets, requiring support for growth) → credit expansion requires more funding support;3) Seasonal liquidity pressures common at year-end (settlements, corporate cash flow, fiscal revenue and expenditure rhythms) → some banks are more likely to raise deposit interest rates to replenish funds;4) Simultaneously, if exchange rate pressure exists, the market pays more attention to the 'opportunity cost of holding VND,' which also drives demand for higher deposit returns.Therefore, it is not uncommon for some banks to 'move faster' at year-end, but it often reflects differences in funding structure pressures rather than a single-direction long-term trend at the macro level.

Question 4

What are the actionable observation points for USD/VND in 2025? Which indicators should investors monitor?

Accepted Answer

It is recommended to break down USD/VND into three categories: "trend indicators + pressure indicators + central bank behavior indicators":

Trend Indicators (determine direction)
- Dollar cycle: US Dollar Index (DXY), US Treasury yields, market expectations for the Federal Reserve's policy path.

Pressure Indicators (determine volatility)
- Trade and settlement: strength of imports, seasonal corporate foreign exchange purchases.
- Interest rate differential: changes in the spread between VND interest rates and USD interest rates.

Central Bank Behavior Indicators (determine 'upper/lower limits')
- SBV's statements on the foreign exchange market and exchange rate stability;
- Changes in foreign exchange supply and demand and intervention signals (typically reflected in policy wording, liquidity injections, and indirect changes in official data).

For overseas investors, the key is to calculate the exchange costs separately for the three stages of "buy—hold—exit," rather than making judgments based on a single exchange rate point.

Question 5

Why should VND/CNY also be considered? How does it differ from VND/USD?

Accepted Answer

VND/USD is more of a reflection of the "global dollar cycle"; while VND/CNY more directly affects the real cost of entering and repatriating funds in RMB.

- Vietnam-China trade and supply chain links are close, with some corporate settlements and fund arrangements generating demand in the RMB dimension.
- If public statistics indicate that CNY/VND overall strengthens in 2025 (meaning VND is relatively weaker against RMB), then:
- The cost of buying VND with RMB increases (entry costs may become higher);
- When repatriating assets/cash flow from Vietnam back to RMB, timing becomes more crucial.

This is particularly important for investors "holding Vietnamese real estate and repatriating rental cash flow."

Question 6

If I am doing asset allocation in Vietnam, how should I incorporate interest rates and exchange rates into the same decision-making table?

Accepted Answer

You can use a very practical "four-grid framework":

1) Local currency returns (deposits/bonds/rental income): High interest rates do not equal high real returns; inflation must be deducted.
2) Exchange direction (VND against USD/CNY): Focus on the exchange rate of your "accounting currency."
3) Volatility risk (maximum drawdown): Use the annual high-low range to estimate the potential upper limit of exchange losses.
4) Policy changes (SBV, credit targets, real estate support policies): Policies are often 'trigger points for turning points.'

After quantifying these four items, you will more easily conclude:
- Whether to lean towards "short-duration cash management" or "long-duration asset holding";
- Whether to use phased currency exchange to reduce risk or concentrate exchange at key windows.

Category	Common Term	"Average Range/Market Mainstream Range" (Annualized)	Interpretation
Current/Demand Deposits	Current < 1 month	Approx. 0.2%	More like a "basic floor rate," primarily serving settlement and liquidity management.
Short-term Fixed Deposits	1 month – < 6 months	Approx. 3.3% – 4.1%	Highly correlated with the tightness of funding conditions and banks' liability gaps.
Medium-term Fixed Deposits	6 months – 12 months	Approx. 4.6% – 5.5%	Typically one of the most commonly used term ranges by residents, with more concentrated competition.
Long-term Fixed Deposits	12 months – 24 months	Approx. 4.9% – 6.1%	Longer term, more sensitive to inflation and exchange rate expectations.

Currency Pair	2025 Characteristics	"Anchor Indicators" for Monitoring	Investment Implications (Brief)
USD/VND	Periodic weakening within the year; common range in public statistical caliber shows an average around 26,000, with a yearly high around 26,4xx	US Dollar Index (DXY), VND-USD interest rate differential, foreign exchange reserves/intervention signals, import costs and inflation	More sensitive to returns denominated in US dollars; short-term fluctuations may affect the timing of capital inflows and outflows.
CNY/VND	Public statistical caliber shows CNY/VND rose about 7% in 2025 (Renminbi relatively stronger)	Renminbi exchange rate, Vietnam-China trade settlement demand, regional supply chain changes	For investors entering Vietnam with Renminbi funds, exchange costs and the timing of repatriation have a more significant impact.

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2025 Vietnam Deposit Rates & VND Exchange Rate Analysis: Trends, USD/CNY...

Executive Summary

Key Data Snapshot (2025 Caliber)

1) Deposit Rates: National Average Range (VNBA Tracking Caliber, August 2025)

2) Exchange Rates: USD/VND and CNY/VND (Summary of Public Historical Statistical Caliber)

Exchange Rate: Why Did the Vietnamese Dong Experience Phased Weakness in 2025? Explained from the "Interest Rate Differential—Expectations—Capital Flows" Perspective

1) Interest Rate Differential and the Dollar Cycle: Determining the Relative Attractiveness of "Holding USD vs. Holding Local Currency"

2) Inflation and Import Costs: Determining "Local Currency Purchasing Power" and Policy Space

3) Capital Flows: Strong FDI Does Not Mean the Exchange Rate Is Always Strong

4) Central Bank Framework: SBV Not Only Focuses on "Interest Rates," but Also Emphasizes Quantitative Tools and Stability

Macro Background: Inflation, Monetary Policy, Credit, and Foreign Capital—How They Jointly Influence Interest Rates and Exchange Rates

1) Inflation: Moderate but with Structural Pressures

2) Monetary Policy: Stable Policy Rates + Quantitative Tools Are More Critical

3) Credit Expansion: Driving Competition on the Deposit Side

4) Foreign Capital and Capital Flows: FDI Strongly Supports Long-Term, but Short-Term Still Depends on Sentiment and the Dollar

Investors' "Monitoring Checklist" (Recommended for Monthly Review)