Inward remittances to Ho Chi Minh City fall 17 per cent in first quarter

Inward remittances to Ho Chi Minh City fall 17 per cent in first quarter

Inward remittances to Ho Chi Minh City have continued their downward trend, falling 17 per cent in the first quarter of 2026 amid global turbulence.

According to the State Bank of Vietnam's (SBV) Region 2 branch, approximately $2 billion in remittances arrived in the city during the period, down from the same period last year. The decline has been ongoing since the fourth quarter of 2025.

Specifically, the municipal city received $2.38 billion of remittances in the fourth quarter of 2025, down 13.3 per cent from the previous quarter. This figure decreased to a little over $2 billion in the first quarter of 2026, down 15.6 from the previous quarter.

Tran Thi Ngoc Lien, deputy director of SBV's Region 2 Branch, said the trend reflects the impact of global and domestic economic conditions alongside geopolitical dynamics.

"A sluggish global recovery, coupled with persistent inflation, has driven up the cost of living," she said.

Lien also noted that tightening monetary policies continue to linger across major economies, negatively affecting manufacturing and business activities. Meanwhile, the Middle East conflict is causing energy price fluctuations and global inflation pressure.

"These headwinds affect the incomes of Vietnamese people living abroad, thereby contributing to the slowdown in overseas remittances," she added.

Disruptions to economic activity in some countries in the Middle East have also lowered the income of Vietnamese workers and their ability to remit money home. However, remittances from this region account for a relatively small share, so the impact is mainly indirect.

Despite macroeconomic stability in Vietnam, some investment channels are not attractive enough for remittances. The narrow interest rate gap between the VND and the USD has partly influenced decisions to send money home.

Another reason is that remittances tend to slow in the first quarter, following a peak season for remittances at year-end and the Lunar New Year period.

The upcoming remittances are forecast not to increase significantly, which is subject to the local and global economic developments. After the lull period in early year, remittances tend to slightly rebound in the next quarters once overseas economic activity and employment gradually stabilise.

However, ongoing conflicts in the Middle East and other regions remain complex, continuing to weigh on energy prices, inflation, and market sentiment. This, in turn, affects the income levels and savings capacity of overseas Vietnamese.

VIR