Vietnam one-year bonds drop in longest losing streak since 2009

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Vietnam's one-year bonds fell for a sixth day on Wednesday, the longest losing streak since November 2009, on speculation government measures to increase credit are spurring banks to accumulate cash for lending. The dong strengthened.

The government will target loan growth of 2 percent a month in the second half and full-year expansion of 12 percent to 13 percent, Deputy Prime Minister Nguyen Xuan Phuc said June 15 without giving comparative numbers.

"Banks want to take profits to get more cash for lending activities," said Nguyen Duy Phong, an analyst at Viet Capital Securities Co. in Ho Chi Minh City.

The yield on the government's benchmark one-year bonds rose three basis points, or 0.03 percentage point, to 9.54 percent, according to a daily fixing rate from banks compiled by Bloomberg. That's the highest level since May 9.

The dong strengthened 0.2 percent to 20,890 per dollar on Wednesday, according to data compiled by Bloomberg. The State Bank of Vietnam set its reference rate at 20,828, unchanged since Dec. 26, according to its website. The currency is allowed to trade as much as 1 percent on either side of the rate.

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