The latest report from United Overseas Bank (UOB) raises Vietnam's 2026 growth forecast from 8,5% to 9,2%. This follows the General Statistics Office's announcement that QIII GDP increased by 9,95%, the fastest rate since QIII/2022, surpassing both UOB's and Bloomberg's 9% predictions.

Consequently, GDP growth for the first 9 months reached 9,01%, maintaining Vietnam's position as the fastest growing economy in ASEAN.

According to the Singaporean bank, manufacturing and investment are the main growth drivers. In the first 9 months, industry and construction grew by 11,21%, contributing 49,62% to the economy's total value added, surpassing the services sector.

The electronics sector remains a pillar, with exports of computers, electronic products, and components reaching approximately 111 billion USD by mid-september, indicating increasing benefits, UOB stated. The investment outlook is "exceptionally positive", following the highest foreign direct investment (FDI) disbursement in 5 years.

UOB predicts QIV growth could be around 9,7%, supported by accelerated public investment disbursement towards the year-end, contributing to the 9,2% GDP for 2026.

UOB's current forecast is among the most optimistic from international organizations, alongside Standard Chartered. Over the last two months, the Asian Development Bank (ADB) and the World Bank have adjusted Vietnam's economic growth forecasts to 7,8% and 7,4% respectively.

According to the government, QIV GDP needs to grow by 12,5% for the full year's growth to reach its 10% target. Localities are instructed to adhere to the QIV growth scenario, review each growth driver and project, and address obstacles for production and business. Public investment continues to be identified as a key driver, requiring 100% disbursement of planned capital.

Phuoc An Bridge, over 4 km long, directly connects Cai Mep - Thi Vai Port with the Ben Luc - Long Thanh Expressway. *Photo: Phuoc Tuan*

Alongside the positive outlook, UOB highlights challenges to monitor, such as rising energy prices due to the unresolved Iran conflict and the potential for the US to implement stricter tariff measures after next month's mid-term elections.

The US Federal Reserve (Fed) is forecast to continue raising interest rates, adding pressure as inflation has already exceeded 4,5%, credit growth is outpacing deposits, and economic growth approaches double-digit levels.

However, monetary tightening may not be effective as inflationary pressures primarily stem from the supply side, risking a slowdown in growth momentum. Therefore, UOB believes the State Bank of Vietnam will maintain the refinancing rate at 4,5% until the end of 2027, alongside using open market operations and credit growth limits to regulate liquidity.

In the foreign exchange market, the trade balance's recent return to surplus, record FDI, and GDP growth above 9% will continue to support the stability of the Vietnamese dong (VND), according to UOB. The USD/VND exchange rate is forecast at 26.300 in QIV and 26.600 in QI 2027.

Vien Thong