A new report from United Overseas Bank (UOB) has raised its 2025 economic growth forecast for Vietnam by 0.9 percentage points to 6.9%. The Singaporean bank adjusted its forecast following better-than-expected second quarter GDP growth and favorable tariff negotiation outcomes.

According to the General Statistics Office, the second quarter growth rate reached 7.96%, exceeding Bloomberg's forecast of 6.85% and UOB's own projection of 6.1%. For the first half of the year, Vietnam's economy grew by 7.52%, the strongest growth since 2011.

Lach Huyen Port Cluster, Hai Phong, 20/1. Photo: Le Tan

Lach Huyen Port Cluster, Hai Phong, 20/1. Photo: Le Tan

UOB assesses that the exceptional growth over the past six months is largely due to exports, which were boosted ahead of the US's retaliatory tariffs, increasing by 14% year-on-year. Following positive news regarding recent trade negotiations between Vietnam and the US, the bank believes "the most intense period has passed" and forecasts a moderate export growth rate for 2025.

This year, the government has set a growth target of over 8%. On 4/7, Finance Minister Nguyen Van Thang assessed that despite international instability, Vietnam's economy is "swimming against the tide, achieving positive results". He believes the minimum growth target of 8% for the last six months of the year is achievable.

UOB suggests that with inflation remaining below the official target of 4.5% in the first half of 2025 and the positive growth results of the general economy, the pressure to loosen policy has decreased. Therefore, they predict the State Bank will maintain the refinancing rate at 4.5%. In addition, the USD/VND exchange rate in Quarter III could be at 26,400 VND and recover to 26,200 VND in the final three months of the year.

Vien Thong