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

## Executive Summary

- **Deposit Interest Rates (National Average Range Perspective)**: According to the monthly tracking of credit institution interest rates by the Vietnam Banking Association (VNBA) (August 2025), demand deposits and "less than 1 month" deposits are generally around **0.2%/year**; **1 month to 6 months** mostly fall within **3.3%–4.1%/year**; **6-12 months** are approximately **4.6%–5.5%/year**; **12-24 months** are about **4.9%–6.1%/year**. This set of data is closer to the "market average range" rather than a single bank's advertised interest rate.

- **Exchange Rate (VND/USD)**: In 2025, the VND generally showed phased weakening against the USD (due to a combination of a stronger USD, changes in interest rate differentials, capital flows, and market expectations). Multiple public exchange rate historical data statistics indicate: in 2025, **USD/VND averaged around 26,000**, with the annual high around **26,434** (the specific high date may vary slightly depending on different statistical perspectives).

- **Exchange Rate (VND/CNY)**: If inferred from the public statistical perspective that "CNY/VND rose by about 7% in 2025" (the Chinese yuan is relatively stronger against the Vietnamese dong), it can be understood as **the Vietnamese dong being generally weaker relative to the Chinese yuan** (the same conclusion can also be expressed as "VND/CNY weakening").

- **Macro Drivers**: In 2025, Vietnam's inflation was overall under control (multiple official statistics show the average CPI for the first 11 months was slightly above 3%), but there were structural pressures such as service prices and housing-related costs. The State Bank of Vietnam (SBV) maintained a relatively accommodative stance: policy interest rates remained at the lower levels after the 2023 cuts (e.g., the framework of a refinancing rate of 4.5% and a discount rate of 3%), while using quantitative tools such as **credit quotas/targets** for adjustment; in the latter half of 2025, the SBV raised credit growth targets to support growth, leading to a chain of "funding demand—competition on the deposit side—interest rate fluctuations".

- **Implications for Overseas Assets/Investors**:
  1) **The level of deposit interest rates** not only reflects funding conditions but also affects the discount rates for real estate mortgages, developer financing, and rental returns;
  2) **VND depreciation** will impact the conversion of returns denominated in foreign currencies, especially rental cash flows and exit timing;
  3) Paying attention to the interplay of "inflation—policy—credit—exchange rates" is more important than focusing solely on a single bank's posted interest rates.

Key Data Snapshot (2025 Caliber)

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

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.

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

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.

Question

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

AIAIGAnswer

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.

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

To clearly understand VND/USD and VND/CNY, the key is not just to look at the exchange rate level, but to understand the **driving factors**:

### 1) Interest Rate Differential and the Dollar Cycle: Determining the Relative Attractiveness of "Holding USD vs. Holding Local Currency"
- When the US dollar interest rates remain high or US dollar assets offer more attractive returns, emerging market currencies (including VND) are more likely to face depreciation pressure.
- Vietnam, under its growth-oriented policy, emphasizes "supporting financing and credit expansion," and is generally more cautious about significant interest rate hikes; this can amplify the interest rate differential issue with the US dollar at certain stages.

### 2) Inflation and Import Costs: Determining "Local Currency Purchasing Power" and Policy Space
- Vietnam's inflation in 2025 was overall under control (official statistics show an average of just over 3% for the first 11 months), providing some room for accommodative policies.
- However, in the inflation structure, rising service prices, housing-related costs, and medical/public services form a "pressure zone." Once combined with exchange rate weakness leading to higher import costs, policies tend to become more cautious.

### 3) Capital Flows: Strong FDI Does Not Mean the Exchange Rate Is Always Strong
- In 2025, foreign direct investment (FDI) disbursement performed positively, providing support for foreign exchange supply.
- But in the short term, the exchange rate is also influenced by: seasonal corporate foreign exchange purchases, overseas debt repayments, peak import seasons, securities fund inflows and outflows, market sentiment, and expectations of central bank intervention.

### 4) Central Bank Framework: SBV Not Only Focuses on "Interest Rates," but Also Emphasizes Quantitative Tools and Stability
- SBV maintains policy rates at low levels (continuing the framework of a refinancing rate of 4.5% and a discount rate of 3%), and regulates the total amount through tools like credit targets/quotas.
- When growth targets are stronger and credit expansion is faster, there often emerges a phase in the short term where marginal interest rate increases (due to competition for funds) coexist with exchange rate pressure.

Question

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

AIAIGAnswer

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.

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

- Official statistics for 2025 show Vietnam's overall CPI within a controllable range (average of the first 11 months around 3%+), meaning **policy has room to balance growth**. - However, when housing-related costs, healthcare/public services, etc., drive core inflation higher, the central bank will emphasize "stabilizing expectations" more to avoid re-acceleration of inflation.

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

- SBV maintains the refinancing rate at 4.5% and discount rate at 3% framework, tending to keep the financing environment friendly. - Compared to simply "raising/lowering interest rates," Vietnam more often uses: - Credit growth target/quota adjustments, - Liquidity injection/withdrawal, - Foreign exchange market operations and management, to influence actual financial conditions.

3) Credit Expansion: Driving Competition on the Deposit Side

- When credit expands faster and targets are raised, the liability side of banks tightens, making deposit rates more prone to "phased increases/competition." - This has a dual impact on real estate: 1) The room for interest rate declines on the loan side may narrow; 2) The discount rate for asset prices rises, putting short-term valuations under pressure; but if economic growth and income expectations improve, it may also form a hedge.

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

- In 2025, Vietnam's foreign capital disbursement remains resilient, with manufacturing still the main absorption area. - However, the exchange rate in the short term is still driven by: the dollar cycle, corporate foreign exchange purchases, securities fund inflows/outflows, and market sentiment.

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

- Deposit rates: Is the VNBA industry range (short/medium/long-term) rising overall? Are only a few banks raising rates? - SBV credit and policy: Are credit growth targets being adjusted again? Is liquidity tightening? - Inflation: Is the gap between CPI and core inflation widening? Are housing/service items rising? - Exchange rate: Is USD/VND approaching the year's extreme range? Is VND/CNY continuing to weaken? - Foreign capital: Is FDI disbursement maintaining growth? Are there changes in fund structure?

WeChat

WeChat Service