Hanoi, Mar 17 (IANS): The State Bank of Vietnam said it would closely monitor local and overseas markets to continue to change its policy rates in the future as circumstances change, the government's news portal reported on Friday.

Given economic uncertainties in the global and domestic markets, the central bank will adjust its policy rates in line with changes in monetary markets, inflation forecasts, and interest rates with an aim to support businesses in their recovery, Xinhua news agency reported.

The bank said it would be cautious about upward pressure on inflation after consumer price index (CPI) in February rose 4.31 percent from a year ago, close to the targeted 4.5 percent for the whole year.

Vietnam will stay vigilant as policy-makers around the world, especially the US Federal Reserve's move next week, are still raising interest rates to control high inflation amid the global financial turmoil caused by the collapse of Silicon Valley Bank.

The central bank cut some of its policy rates by 100 basis points on Tuesday in an effort to support the economy, the discount rate to 3.5 per cent and the overnight lending rate in the inter-bank market to 6 per cent, while lowering the cap on interest rates for short-term loans in some priority sectors under the government policy to 5 per cent from 5.5 per cent.