Annual interest rate on dollar deposits cut to zero percent

Hanoi (VNA) – The maximum interest rate paid to individuals depositing USD in local banks will be zero percent per year from December 18, the central bank announced.

Organisations, excluding credit institutions or branches of foreign banks, will also not receive interest for dollar accounts.

This notice was confirmed in Decision No.2589/QD-NHNN released on late December 17.

Prior to the change, the maximum interest rate for individuals was 0.25 percent per annum.

The central bank said the decision was made to continue implementing concerted measures to increase the value of Vietnam dong and curb the dollarisation of the economy.

Earlier on December 17, the US Federal Reserve (FED) decided to raise interest rates by 0.25 percentage points, which, however, has not prompted the State Bank of Vietnam to change its policy on stabilising foreign exchange rates.

Vietnam’s forex market saw almost no fluctuations after the FED decision and the prices of US dollar at commercial banks remained at the ceiling, experts said.

As of 8:20 am, Vietcombank quoted selling price of USD at 22,547 VND and buying price at 22,517 VND, the same rates as BIDV. Meanwhile, Eximbank kept its buying and selling rates steady at 22,497-22,547 VND per one USD.

The green notes have rebounded quickly and hit the ceiling since earlier this week. The commercials banks also raised the buying price after pegging the selling one to the ceiling in anticipation of the US central bank’s adjustment.-VNA