GDP growth expected to reach 5.5% in Q1: UOB

By Dat Nguyen   March 11, 2024 | 08:01 pm PT
GDP growth expected to reach 5.5% in Q1: UOB
A woman works at a factory in Tan Thuan Manufacturing Zone, Ho Chi Minh City. Photo by VnExpress/Le Tuyet
Singapore-based lend United Overseas Bank (UOB) has pegged Vietnam’s GDP growth at 5.5% in the first quarter, compared to 3.3% in the same period last year.

It anticipates a 6% growth for the whole year, compared to 5% last year.

Vietnam’s Purchasing Managers’ Index in the first two months were above 50, compared to the average 49.3 in the same period last year.

Exports in the first two months rose 17.6% year-on-year and industrial production gained 5.7%.

These data suggest that the overall momentum in the external trade and manufacturing sectors is showing positive signs.

"We expect the pace to sustain especially in second half when the recovery in the semiconductor sector is more entrenched and global central banks embark on a more accommodative policy stance."

While risks of external events continue to weigh on global economic prospects, Vietnam’s prospects are bolstered by the recovery in the semiconductor cycle, stable growth in China and the region, as well as supply chain shifts that are in favor of Vietnam and ASEAN.

The bank anticipates inflation pressures to remain on the upside, with a forecast of the headline Consumer Price Index to stay elevated at 3.8% in 2024, from 3.25% in 2023.

UOB also forecast that the State Bank of Vietnam will keep refinancing rate at the current level of 4.5%.

The U.S. dollar reached a new height of VND24,700 in late February but the bank expects the Vietnamese dong to recover gradually and reach VND23,800 against the dollar by the first quarter next year.

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