HANOI, July 2 — Global risks are complicating the Vietnamese central bank's policy management, Deputy Governor Pham Thanh Ha said Thursday. The Southeast Asian manufacturing hub aims for economic growth exceeding 10% this year, supported by increased infrastructure spending. However, the ongoing conflict in Iran poses a threat to these ambitions.

"Geopolitical tensions and trade frictions have continued, while the escalation of the conflict in the Middle East in particular has placed significant pressure on international commodity and financial markets," Ha said at a press conference in Hanoi.

Ha noted that the Vietnamese dong has come under pressure due to a strengthening U.S. dollar, but the central bank has managed the foreign exchange market flexibly and fully met the demand for foreign currencies within the economy.

Pham Chi Quang, head of the central bank's monetary policy department, also addressed the conference, stating that Vietnam faces mounting inflationary pressure linked to its exposure to the global economy. Vietnam's annual inflation rate reached 5.6% in May, surpassing the government's target of 4.5% for the year.

Quang emphasized that controlling inflation will be a priority for the central bank throughout the remainder of the year to maintain macroeconomic stability, while still striving to meet the government's economic growth target of over 10%.

Sources