Macroeconomic Forecast Vietnam

In line with our long-held view, the State Bank of Vietnam has announced its decision to devalue the Vietnamese dong by 9.3%, sending the unit down to the lower limit of its trading band at VND20,900/US$. Despite the move, we note that underlying concerns - most notably dogged inflationary pressures - remain firmly in play. With this in mind, we are increasingly concerned that a failure by the SBV to address these factors will inevitably lead to further devaluations down the line.

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