SBV remains cautious ahead of the week of uncertainty

This week, the SBV injected modest liquidity into the banking system after four weeks of withdrawals to cool the rising USDVND. The interbank rates are mostly unchanged compared to last week in response to the movements of the central bank. Information from this week indicates a greater level of uncertainty ahead of significant upcoming events such as the results of the U.S. election and the FOMC meeting, which casts a substantial impact on both the global and domestic economy. SBV is still cautious with a dominant outstanding amount of T-bills compared to existing repo contracts. It seems FX stability would be the top priority at the moment. Furthermore, we anticipate heightened volatility in USDVND in the upcoming weeks due to crucial global events and the maturity of the USD-denominated 10-year Government bonds this November.