Macroeconomy

• Exchange rate: The Fed’s rate cuts and expected further easing, coupled with a supportive foreign exchange supply outlook for Q4, are seen as bullish for the VND. We forecast a 1-2% depreciation of the VND by year-end.
• Inflation: The resurgence of electricity prices in October will push the Consumer Price Index (CPI) for November and December back above 3%, compared to September's 2.63%. However, with the slowing pace of CPI increase in recent months, full-year inflation in 2024 is projected to be only around 3.5-3.8%, below the government's target of 4-4.5%.
• Interest rate: The growth pace of deposit interest rate has moderated in recent months, staying relatively low. As pressures on the exchange rate and inflation ease, the SBV may continue its expansionary monetary policy in the fourth quarter.
• 2024 GDP Forecast: Expecting continued monetary easing and accelerated credit growth in the fourth quarter, GDP growth in Q4 is projected to sustain its strong pace, supporting an annual GDP growth rate of 6.5-6.7%.

Stock market

• VN-Index continues to miss the resistance level of 1,300 points in the third quarter.
• VnIndex rose by 3.4% in Q3, quite modest compares to other markets the region. Big-caps, especially Banks, had led the growth.
• The average daily trading value across all three exchanges reached VND18.6 trillion, down 26.37% QoQ. There were 820,000 new accounts opened in Q3, bringing the year-to-date total to 1.6 million.
• Foreign investors continued to be net sellers by selling over VND14 trillion in Q3, bringing the total net selling for the year to over VND66 trillion. ETFs saw nearly VND20 trillion in foreign outflows, including almost VND5 trillion in the third quarter. The Finance, Materials, and Banking sectors bore the brunt of the selling.
• BVSC sustains its forecast that Vnindex will reach 1,350 in 2024.