At a press conference in Hanoi on January 26, Mr Giau said that both mobilizing and lending interest rates remain high as many businesses have had to store goods for Tet and pay staff salaries and bonuses.

In addition, the increasing prices of many goods have driven the CPI in January up by 1.74 percent compared to December 2010, and up 12.17 percent against the same period last year.

Therefore, the governor said that if CPI in February is around 1.4 percent, the SBV will reduce basic interest rates immediately.

Mr Giau added that the foreign exchange market has seen positive signs of bouncing back since the beginning of the year. Commercial banks continue to buy foreign currencies and actively sell to the domestic market. In addition, a surge in the amounts of overseas remittance, foreign investment and export turnover has helped to balance the supply and demand of foreign currencies in the market.