Macro Update – March 2026: SOLID EXPANSION AMID EXTERNAL HEADWINDS

March 2026 macroeconomic data indicates the ongoing conflict in the Middle East is transmitting directly into domestic inflation, consumption, and industrial production. Vietnam recorded solid real GDP expansion in 1Q26. Maintaining this growth trajectory through FY2026 will test the economy against secular headwinds, specifically inflationary pressures, foreign exchange dynamics, and moderating external demand.

As of March 23, credit expansion reached approximately 2.15% YTD, significantly outpacing deposit growth of 0.44% YTD. This widening funding gap sustains persistent pressure on interbank liquidity.

Looking toward 2H26, interest rates will likely remain elevated relative to the FY2025 baseline. Core funding structures within the banking sector continue to lag accelerating credit demand. Validating the timeline and magnitude of any prospective rate cuts necessitates close monitoring of deposit rate pricing among SOCBs and major private banks over the coming quarters, alongside forward guidance from the SBV.