Vietnam may remove deposit rate ceiling by July-report

HANOI, March 27 Tue Mar 27, 2012 2:32am BST

HANOI, March 27 (Reuters) - Vietnam's central bank may remove a ceiling on deposit rates in June or July if liquidity in the system continue to improve and inflation slows, a state-run newspaper reported on Tuesday, quoted the governor.

The State Bank of Vietnam also aims to cut the rate ceiling by an average 1 percentage point each quarter of sooner if the situation improves, Governor Nguyen Van Binh told a government meeting on Sunday, according to the report.

Earlier this month the central bank cut key rates on dong loans and deposits, by 1 percentage point, for the first time in nearly three years and its governor was then quoted as saying commercial lending rates could now fall, helping businesses.

The central bank currently caps interest rates on dong deposits for one year or more at 13 percent, short-term deposits at 5 percent and dollar deposits at 2 percent. (Reporting by Ho Binh Minh; Editing by Ramya Venugopal)

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