Macro Outlook Report

Industrial growth showed signs of a recovery: The index of industrial production (IIP) of the whole industry sector in the first two months was estimated to gain 9.2% YoY, lower than the 13.7% increase in 2018. However, regarding the high growth base in January 2018 and the nine-day Lunar New Year holiday, this can be considered a positive growth. The processing and manufacturing sector started to rebound (+11.5% YoY), while the mining sector plunged (-4.7% YoY, compared to the decrease of -1.8% YoY in 2018). In particular, in 2019 Samsung has launched the new mobile phone products one week earlier than in 2018, most of manufacturing activities were focused on November and December last year instead of December and January as in 2018. The total volume of mobile phone production in November, December 2018 and January 2019 hit 57.4 million phones, +5.1% more than that in 2018. The television manufacturing sector has maintained the momentum since 2017, with the total producti

GDP: GDP in 2018 grew by 7.08% thanks to significant contribution from processing and manufacturing industries. GDP growth is expected to gain 6.6 – 6.8% in 2019. Inflation: Average headline CPI in 2018 was 3.54% due to the pressure of climing prices of oil, healthcare services and food. 2019 CPI is forecast to be around 3.8 – 4.0%. Monetary policy: M2 and credit growth in 2018 dropped due to the SBV’s prudent monetary policy. In 2019, monetary policy continues to manage prudently, M2 and credit growth are supposed to be 11- 13% and 13 - 15% respectively. Exchange rates: VND depreciated by 2.4% in 2018 because of external factors. In 2019, VND could depreciate by 2.3 - 2.5%

GDP Growth: GDP growth strengthened in the first 9 months thanks to robust growth rate in Q1 and Q3, however, it is expected to slow down in Q4/2018. Inflation: Q2 and Q3’s CPI were on the rise, pressure on SBV’s 2018 average inflation target of 4%. Monetary policy: Monetary policy will be more prudent till year-end. Exchange rate: Exchange rate will be under control if VND depreciation is within 3%. External factors will be the most influencers to VND in Q4.

Growth: GDP’s growth strengthened with the highest 1H growth rate since 2011, however it is estimated to slowdown till year-end. Inflation: CPI reached highest June’s CPI since 2011, high pressure on SBV’s inflation target of 4%. Interest Rate: SBV’s monetary may show sign of tightening up in 2H2018. Exchange Rate: Under control if depreciation within 2% movement. Trade deficit, pressure on Balance of Payment.

1. Vietnam Macroeconomics Scorecard from 2009 to 2018 2. Vietnam Stock Market Review in 2Q.2018 3. Stock market’s concerns and opportunities in 3Q.2018 4. Stock market’s scenarios in 2H.2018 5. Recommendations and investment opportunities