The central bank further cuts benchmark interest rate to aid economy (Photo: VNA) Hanoi (VNA) - The State Bank of Vietnam (SBV) on September30 announced its decision to lower the benchmark interest rate as part of efforts to support the national economy amiddifficulties posed by the COVID-19 pandemic.
From October1, the refinancing interest rate will be cut to 4 percent per annum from 4.5 percent,while the rediscount interest rate will go down to 2.5 percent from 3 percent.
The overnight electronic interbank rate and rate of loans to offset capital shortage in clearance between the SBV and credit institutions will be loweredto 5 percent per annum from 5.5 percent.
The central bank also decided to cut the interest rate of bids of valuablepapers through open market operations from 3 percent per annum to 2.5percent.
Regardingthe maximum interest rate for deposits in Vietnam dong (VND) by organisations andindividuals at credit institutions and foreign bank branches, the SBV stipulatesthat the maximum interest rate applicable to demand deposits and those of lessthan one month is 0.2 percent per annum.
The maximum interest rate applicable to deposits with termsfrom one month to less than sixmonths will fall to 4 percent per annum from 4.25 percent.
The maximumrate for deposits with terms of one month to less than six months at people’s credit funds and microfinance institutions will be cut to 4.5 percent per annum from 4.75 percent,while interest rates on deposits with a term of six months or more will be determinedby credit institutions on the basis of market capital supply and demand.
Notably,loans to borrowers in a number of regulated fields and economic sectors havebeen cut to 4.5 percent per annum from 5 percent. The maximum short-term lendinginterest rate in VND at people’s credit funds and microfinance organisations forthese capital needs is now down from 6 percent per annum to 5.5 percent.
Accordingto the central bank, since early this year it has synchronously operated monetarypolicy tools to control inflation, stabilise the macro-economy and the monetarymarket, and reduce the market interest rate to support economic recoveryamid the COVID-19 pandemic./.
VNA
