Vietnam one-year bond yield touches two-week high before auction

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Vietnam's one-year bonds fell for a fourth day, pushing the yield to a two-week high, ahead of an auction of 9 trillion dong ($432 million) of new government debt tomorrow. The dong was steady.

The State Treasury will offer 4 trillion dong each of two- and three-year securities, and 1 trillion dong of 10-year notes at the sale, according to the Hanoi Stock Exchange website. Yields fell more than 50 basis points at the last auction of two- and three-year debt on Jan. 11.

"Traders are waiting until tomorrow to see if they can get a better yield in the primary market," said Nguyen Duy Phong, a Ho Chi Minh City-based analyst at Viet Capital Securities Co.

The yield on one-year bonds rose four basis points, or 0.4 percentage point, to 7.86 percent, according to a daily fixing from banks compiled by Bloomberg. It added 14 basis points in the past four days, the longest run of increases since Sept. 20. The five-year yield fell two basis points to 9.05 percent.

The dong traded at 20,840 per dollar as of 2:26 p.m. in Hanoi, unchanged from Jan. 25, according to data compiled by Bloomberg. The State Bank of Vietnam set its reference rate at 20,828, unchanged since December 2011, according to its website. The currency is allowed to trade up to 1 percent on either side of the rate.

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