Vietnam's economic growth may slow in H2 amid positive outlook: UOB

05 Jul '24

2 min read

Vietnam's economic growth may slow in H2 amid positive outlook: UOB

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Vietnam's economic growth may decelerate in the second half this year after expanding by 6.42 per cent in the first, a recent report by the United Overseas Bank (UOB) said.
UOB forecasts the country's 2024 growth at 6 per cent.
Several supportive factors, however, are expected to sustain the overall growth outlook.
Foreign trade remained robust in Q2 2024.

Vietnam's economic growth may decelerate in the second half (H2) this year after expanding by 6.42 per cent in the first, a recent report by the Singapore-based United Overseas Bank (UOB) said. Growth rate was 3.84 per cent in H1 2023.

UOB forecasts the country’s 2024 growth at 6 per cent. The government's target range is 6-6.5 per cent.

Several supportive factors, however, are expected to sustain the overall growth outlook, UOB’s global economics and market research unit noted in the report.

Most foreign investors have a positive long-term outlook for the country, UOB analysts noted. This is reflected in the 13.1-per cent year-on-year (YoY) rise in registered foreign direct investment (FDI) in H1 2024 to $15.2 billion.

The country’s real gross domestic product (GDP) grew by 6.93 per cent YoY in the second quarter (Q2) this year, after a 5.87-per cent rise in Q1, UOB experts said.

The manufacturing and services sectors continued to drive most business activities, while foreign trade remained robust in Q2, domestic media outlets in Vietnam reported citing the UOB document.

The recent depreciation of the Vietnamese dong against a strengthening US dollars and rising inflation may prompt the country’s central bank to be cautious with any changes to policy rates, the report added, projecting that the central bank would maintain the refinancing rate at the current level of 4.5 per cent.

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