The Singapore-based United Overseas Bank (UOB) has kept its forecast for Vietnam's GDP growth in 2023 unchanged at 6.6% in line with the official forecast of 6.5%, although growth momentum is likely to be weaker.
In its report on Vietnam's economic growth in the last quarter of 2022 and prospects for 2023, the bank said Vietnam's real GDP growth in the fourth quarter of 2022 returned to normal at 5.92% year on year, due to signs of a decline in external demand. There was a sharp increase of 13.67% in the third quarter.
The General Statistics Office (GSO) reported that the country's GDP expanded by 8.02% in 2022 from the growth of just 2.58% in 2021. This is the fastest pace annually since 1997.
UOB experts said that the strong growth thanks to its manufacturing and service industries in 2022 shows Vietnam's resilience after the impact of the COVID-19 pandemic.
The bank said the inflation rate is likely to remain stable, especially in the first half of 2023 thanks to the flexible management of monetary policy by the State Bank of Vietnam.
At the end of December 2022, the State Bank of Vietnam said that it will operate monetary policy "flexibly" to keep the inflation rate at 4.5% in 2023, aiming to stabilise the currency and foreign exchange markets.
Regarding the foreign exchange strategy, UOB forecast a upward momentum of VND/USD exchange rate with a forecast of 25,200 VND, 25,400 VND, 25,600 VND, and 25,800 VND in the four quarters of 2023.