HANOI, July 7 (Reuters) - The State Bank of Vietnam (SBV), the central bank, said on Friday it would cut several interest rates to support economic growth and control inflation.
The annual refinancing rate, rediscount rate, overnight electronic interbank rate and rate of loans to offset capital shortage in clearance between the SBV and domestic banks would be cut by 0.25 percentage points each from July 10, the central bank said in a statement.
The annual maximum short-term interest rate for loans in the dong currency by financial situations in some sectors would also be cut by 0.5 percentage points from July 10, SBV said without elaborating which sector.
Vietnam’s National Assembly and government have been pushing for lower interest rates in banks to support businesses and boost economic growth, which faces challenges to achieve its 2017 target of 6.7 percent.
Vietnam’s economy needs to grow 7.4 percent in the second half of 2017 to achieve its full-year target, after it grew at a three-year low of 5.15 percent in the first quarter and 6.17 percent during April-June.
The rate cuts would help increase liquidity for banks to provide credit to the economy, stablise the economy, interest rates and the foreign exchange market, control inflation and boost economic growth, the central bank said. (Reporting by Mai Nguyen; Editing by Robert Birsel)