Macro Update – June 2026: SHIFTING GEARS FOR ACCELERATION

Macroeconomic data for 2Q26 confirms sustained growth momentum across the Vietnamese economy. The robust expansion was primarily catalyzed by industrial production, FDI, international tourism, and an acceleration in public investment disbursements, which collectively propelled GDP growth to 8.39% YoY for the quarter.

• 1H26 GDP surged 8.18% YoY—marking the strongest first-half performance in recent years. Underpinning this trend, IIP advanced 10.8% YoY YTD, registering its fastest first-half acceleration since 2019. Domestic consumption and services also demonstrated resilience, with retail sales expanding 12.9% YoY and international arrivals reaching 12.3 million (+14.9% YoY). Furthermore, disbursed FDI touched a five-year high for the first half at US$13.03bn. Coupled with a 61.0% surge in registered capital, these figures underscore foreign investors’ enduring commitment to the market and reinforce the narrative of long-term supply chain resilience.
• Although average inflation remains elevated, price pressures moderated in June on the back of easing energy costs. Headline CPI averaged 4.38% YoY in 1H26, with core inflation tracking at 4.12%. Notably, the 2Q26 average print stood at 5.25%, breaching the National Assembly’s statutory 4.5% ceiling. However, diverging from preceding months, headline CPI contracted 0.39% MoM in June. This deflationary blip mitigates near-term downside and was largely driven by downward adjustments in domestic fuel prices, which tracked global crude oil benchmarks lower following the conditional reopening of the Strait of Hormuz.
• Tariff risks continue to cloud the broader macroeconomic outlook. Persistent demand for raw material imports flipped the trade balance, resulting in a cumulative deficit of US$16.65bn in 1H26 (1H25: +US$7.95bn). More critically, a US$75.3bn bilateral trade surplus with the US keeps Vietnam squarely under the purview of Section 301 scrutiny, heightening secular headwinds as markets brace for the upcoming July 7 congressional hearings.
• Against a backdrop of exchange rate stability and decelerating inflation, the central bank has found runway for further monetary accommodation. Policymakers deployed three distinct easing measures in June: reinstating the 40% cap on the ratio of short-term funding utilized for medium- and long-term lending, relaxing regulations on State Treasury deposits, and recalibrating credit growth quotas. These initiatives are strategically designed to unclog credit transmission channels and bolster pro-growth monetary policies.
• Aggressive fiscal expenditure via public investment will be the pivotal growth catalyst for 2H26. Dedicated public investment disbursements stood at just VND299tn as of June 25, representing a mere 29.2% of the Prime Minister’s mandate. Given the substantial capital backlog and the government’s ambitious full-year GDP growth target of over 10%—which implicitly necessitates a staggering 2H26 expansion approaching 11.9%—we expect accelerated project execution in the coming months to serve as the primary engine for meeting these statutory targets.