Vietnam's five-year bonds gained for a second day on speculation banks are purchasing more government debt due to an increase in foreign investment.
"According to some data from our investment department, some commercial banks have received indirect investment from foreign investors so they may have converted the US dollar inflow into dong and invested this money into the bond market," Nguyen Duy Phong, a Ho Chi Minh City-based analyst at ACB Securities Inc. wrote in a research note obtained today.
Five-year yields fell two basis points, or 0.02 percentage point, to 12.71 percent, according to a daily fixing from banks compiled by Bloomberg. The dong was unchanged at 20,550 per dollar as of 3:35 p.m. in Hanoi, according to prices from banks compiled by Bloomberg.
The central bank set the reference rate at 20,618 today, unchanged from June 10, its website showed. The currency is allowed to trade up to 1 percent on either side of the official rate.