Vietnam's bonds fell on speculation banks have fewer funds to invest in debt after the central bank drained cash from the market. The dong was unchanged on Friday.
The State Bank of Vietnam withdrew a net VND6.6 trillion ($314 million) in the past four days, said Nguyen Duy Phong, a Ho Chi Minh City-based analyst at ACB Securities Inc. The monetary authority pumped in a net VND12.9 trillion last month, he added.
"Since the central bank withdraw a large amount of money from open market operations, the bond yields increased amid the lack of liquidity in the banking system," Phong said.
Yields on five-year government debt rose three basis points, or 0.03 percentage point, to 12.43 percent, according to a daily fixing from banks compiled by Bloomberg.
The dong traded at 21,009 per dollar as of 2:40 p.m. in Hanoi, according to data compiled by Bloomberg. The central bank set the reference rate at 20,803, unchanged since Oct. 28, its website showed. The currency is allowed to trade up to 1 percent on either side of the official rate.