HANOI — The State Bank of Vietnam announced a reduction in its policy rates, making a second cut in less than two months to help the economy weather the impact of the coronavirus pandemic.
With just 288 infections and no deaths, the Southeast Asian nation has seen no community infections for nearly a month, putting it on course to resume economic activity sooner than most others in the region.
The refinancing rate will be cut to 4.5 percent from five percent and the discount rate to three percent from 3.5 percent, effective Wednesday, the central bank said in a statement.
The rate cut is part of the government's efforts to “help businesses to overcome difficulties and ensure social security amid the COVID-19 pandemic,” the central bank said in a statement posted on its website on Tuesday.
The central bank said it would also lower the caps on the interest rates of dong-denominated deposits from Wednesday, cutting by 0.3-0.5 percentage points, depending on the maturities.
Prime Minister Nguyen Xuan Phuc said last week Vietnam will try to keep its economic growth above five percent this year, backed by public investment, foreign direct investment, exports and domestic consumption.
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