As part of the latest economic growth in Q1/2023 report for the country, the bank stated that Vietnamese GDP growth in the period only increased by 3.32% on-year, a sharp fall from 5.92% in Q4/2022.

Based on statistics compiled by the General Statistics Office (GSO), it attributed the fall to negative factors in production and export.

The bank’s experts said that inflation in the nation has shown positive signs as the consumer price index (CPI) in Q1/2023 rose by 4.18% compared to the same period from last year and dropped by more than the 4.5% target set by the Government.

The country’s March CPI soared by 3.35% on-year, but declined by 0.23% compared to February, indicating a slower pace in inflation.

The UOB also predicted that further loosened polices will be introduced by the State Bank of Vietnam (SBV) moving forward.

With the US Fed expected to end its rate hike cycle as soon as May this year and domestic inflation rates showing some signs of reversing, the bank anticipates that the SBV will cut its refinance rate sometime in the second quarter by 100bps to 5%.