Vietnam Central Bank Net Withdraws VND4.95Tln via OMO in Week Ending Nov 9

The State Bank of Vietnam (SBV) net withdrew VND4.95 trillion through open market operations (OMO) in the week ending Nov 9 after it pumped VND1.869 trillion and withdrew VND6.819 trillion, the BaoViet Securities Company (BVSC) said.

The monetary authority also sold VND7.5 trillion worth of T-bills under 56- and 91-day maturities during the week, up VND6.164 trillion one week earlier.

Fixing for 56-day T-bills rose 0.1% to 6% while that for 91-day debts remained flat at 6.8%.

The average interbank rate fell to 2.75% p.a. for overnight; 3-3.25% for 1-week; 3.5-4.75% for 2-week and 5.4-6% for 1 month terms during the period.

Low interbank rates in the past time partly reflects ample liquidity of some commercial banks and demonstrates declining demand for interbank funds after the central bank asked lenders to make provisions for interbank loans, BVSC noted.

The central bank switched to a net withdrawal on OMO last week thanks to stable monetary market, low interbank rates, and abundant bank liquidity, which resulted from sluggish demand for loans currently.

In the week ending Nov 2, the central bank net injected money through OMO to support liquidity to commercial banks in the early days of the month.

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