Ho Chi Minh City (VNA) – Remittances to Ho Chi Minh City fell in the first quarter of 2026, reflecting a combination of global economic uncertainties, geopolitical tensions, and seasonal factors, according to the State Bank of Vietnam (SBV)'s Region 2 branch.
Data from the branch showed that remittances transferred through credit institutions and economic organisations in the city exceeded 2 billion USD in the January–March period, down 15.6% from the previous quarter and 16.9% year-on-year.
The downward trend has been evident since late 2025. In the fourth quarter of last year, remittances reached nearly 2.38 billion USD, already marking a 13.3% decline compared to the preceding quarter, before continuing to shrink in early 2026.
Tran Thi Ngoc Lien, Deputy Director of the branch, said the decline reflects multiple external and domestic factors. A slow and uneven global economic recovery has weighed on the incomes of overseas Vietnamese, while persistently high inflation in many countries has increased living costs, reducing savings and the capacity to remit money home.
Prolonged monetary tightening in major economies has also put pressure on production and business activities, indirectly affecting workers’ earnings and remittance flows to Vietnam.
Geopolitical tensions, particularly conflicts in the Middle East, have further exacerbated energy price volatility and global inflation, impacting real incomes. In some countries hosting Vietnamese workers, economic disruptions have posed risks to employment and earnings, thereby limiting remittances. However, the central bank noted that the direct impact remains limited as remittances from these markets account for a relatively small share.
Domestically, macroeconomic stability has been maintained, but investment channels have yet to become sufficiently attractive to draw strong remittance inflows. Meanwhile, the modest interest rate gap between the Vietnamese dong and the US dollar has also influenced transfer decisions.
Seasonal patterns have also played a role. Following the year-end peak driven by holiday spending during the Lunar New Year, remittances typically decline in the first quarter, making year-on-year decreases more pronounced.
Looking ahead, remittance inflows may not rebound strongly in the near term, as they depend on both global and domestic economic conditions. Typically, flows recover gradually in subsequent quarters as overseas labour markets stabilise.
However, ongoing geopolitical uncertainties, especially in the Middle East and other regions, are expected to continue exerting pressure on energy prices, inflation and global market sentiment, potentially weighing on remittance inflows.
A similar trend has been observed in other localities. In neighbouring Dong Nai province, remittances channelled through credit institutions reached over 36.4 million USD as of March 31, down 15.7% year-on-year./.
