Standard Chartered predicts Viet Nam's 2024 GDP growth at 6%

Standard Chartered noted that the country has still recorded an improvement from 5 percent in 2023. The GDP growth in the first quarter of the year stood at 5.7 percent compared to the previous 6.7 percent seen in the fourth quarter of last year.

The growth forecast in the second quarter and the third quarter is 5.3 percent and 6 percent, respectively, while the fourth quarter's growth is expected to be recovered to 6.7 percent.

According to Standard Chartered's economist, trade makes up a key source of growth and investment for the Vietnamese side, although the country also faces short- and long-term challenges. Despite these issues, Vietnamese recovery remains intact despite risks, with retail sales growth still being robust in the first quarter of the year.

Standard Chartered also lowered Viet Nam's 2024 inflation forecast to 4.3 percent from 5.5 percent to reflect lower-than-expected inflation in the first quarter.

The bank anticipated rates to stay on hold at 4.5 percent until end of the third quarter of the year and could be raised by 50 basic percentage points in the fourth quarter in response to growth-driven inflation.

"Viet Nam is improving its position in global supply chains. Foreign investment continues to be attracted by a favorable investment environment", said Tim Leelahaphan, economist for Thailand and Viet Nam of Standard Chartered.

"With economic recovery starting to gain momentum, we think there will be less need to provide monetary policy support," he added.

According to Leelahaphan, there is a balanced view on the Viet Nam Dong (VND) given improvements made on the external front and reserve rebuilding.

Strong export growth will provide some support for the currency, while imports point to further gains, thus the bank forecasted a current account surplus of 3.5 percent GDP in 2024./.