Vietnam dong gains after central bank sells dollars; bonds rise

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Vietnam's dong gained, halting a three-day loss, after the central bank pumped in dollars to the currency market amid rising demand for the greenback. Bonds rose.

The State Bank of Vietnam sold $150 million this month to stabilize the dong, the Thoi Bao Ngan Hang newspaper reported Friday. The currency strengthened to about 21,350 per dollar in the unofficial black market yesterday from as low as 21,600 earlier this month, according to the report.

"What the central bank has done just helped ease pressure on the dong a bit," said Nguyen Duy Phong, Ho Chi Minh City- based analyst at ACB Securities Inc. "The dong may still fall since dollar liquidity at banks is low, while demand is high."

The dong rose 0.2 percent to 20,845 per dollar as of 3:26 p.m. on Friday in Hanoi, according to data compiled by Bloomberg. It was up 0.07 percent from a week ago. The State Bank of Vietnam fixed the dong's daily reference rate at 20,688, compared with 20,678 yesterday, according to its website. The currency is allowed to trade up to 1 percent on either side of the rate.

The yield on the government's five-year bonds fell four basis point, or 0.04 percentage point, to 12.36 percent, according to a daily fixing price from banks compiled by Bloomberg.

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