Vietnam's five-year bonds on Monday fell on speculation an increase in money-market rates prompted banks to sell the securities to raise cash. The dong was steady.
Overnight interbank borrowing rates climbed to 12.25 percent Monday, the highest level since Dec. 16, from 11.95 percent on Jan. 6, data compiled by Bloomberg show.
The money market will continue to face shortages in the early months of 2012, the National Financial Supervisory Commission wrote in a report released Monday.
The central bank should inject cash into banks to help ease the funding crunch, Deputy Chairman Le Xuan Nghia said in a meeting with economists in Hanoi.
"Due to low liquidity, banks have been selling bonds to raise cash," said Tong Minh Tuan, deputy head of research at Hanoi-based BIDV Securities Co., a unit of Bank for Investment & Development of Vietnam.
The yield on the benchmark five-year note gained three basis points, or 0.03 percentage point, to 12.54 percent, the biggest increase since Dec. 23, according to a daily fixing from banks compiled by Bloomberg.
The dong was unchanged at 21,030 per dollar as of 5 p.m. in Hanoi, according to data compiled by Bloomberg. The central bank fixed the reference rate at 20,828 today, unchanged since Dec. 26, according to its website. The currency is allowed to trade up to 1 percent on either side of the rate.
The government may lower the reference rate by as much as 6 percent this year as gold buying puts downward pressure on the currency, according to the Financial Supervisory Commission's report.