The bank maintains the 2024 GDP growth forecast at 6.7 per cent, growth accelerating from 6.2 per cent year-on-year in the first half of the year to 6.9 per cent in the second half of the year.

According to the international bank, March data is likely to show a recovery after Tết (Lunar New Year), supported by retail sales. The bank expects retail sales growth to rise to 9.2 per cent year-on-year in March; export growth is likely to rebound to 5.2 per cent year-on-year; import growth at 5.0 per cent while the trade surplus may narrow to US$0.8 billion. Inflation may rise further to 4.2 per cent in March (from 4.0 per cent in February). Education, housing (construction materials) and food prices have driven inflation recently. A stronger recovery in FDI inflows would require faster GDP growth.

Tim Leelahaphan, Economist for Thailand and Vietnam, Standard Chartered Bank, said: “Despite the likely Q1 slowdown, we think Vietnam’s recovery remains intact. However, we are cautious on the H1 growth outlook due to headwinds to global trade.”

The bank expects the State Bank of Vietnam to keep the refinancing rate on hold at 4.5 per cent through end Q3-2024 and hike by 50bps in Q4, given concerns about growth - driven inflation.