Bonds fall on dollar debt plan; dong little changed

Bonds fall on dollar debt plan; dong little changed

Bonds dropped for the first time in four days after the government said it plans to sell US dollar-denominated debt in the domestic market.

Prime Minister Nguyen Tan Dung has instructed the Ministry of Finance to work on the sale’s details including the timeframe and amount, according to a February 14 statement on the government’s website. The maturity of the securities will be at least one year. The yield on the benchmark five-year note rose 0.07 percent to 8.53 percent as of 3 p.m. in Hanoi, according to a daily fixing price from about 10 banks compiled by Bloomberg. The yield dropped last week on speculation policy makers will add to six interest-rate cuts since the start of October to bolster the economy. “Investors have bought less, probably because they wanted to wait for more details on the bond sale,” said Tran Tri Thanh, deputy head of fixed-income trading at Hanoi-based Vietnam International Commercial Joint-Stock Bank. “US dollar-denominated securities may be more attractive to investors, especially those from overseas.” The dong was little changed at VND17,487.5 per dollar, according to data compiled by Bloomberg. The State Bank of Vietnam set the reference rate at VND16,981 Monday, compared with VND16,979 on February 13, according to its website. The currency can trade 3 percent on either side of the fixed rate. Source: Bloomberg