USD recovers to 109 mark

USD exchange rate today (January 18): Early morning of January 18, the State Bank announced the central exchange rate of the Vietnamese Dong to the USD increased by 8 VND, currently at 24,341 VND.

Meanwhile, in the US market, the US Dollar Index (DXY) measuring the greenback's fluctuations against six major currencies (EUR, JPY, GBP, CAD, SEK, CHF) increased by 0.45% to 109.41.

USD exchange rate today in the world

The US dollar rose against other currencies in the last trading session, but ended the week on a negative note after six consecutive weeks of gains, as investors awaited the inauguration of US President-elect Donald Trump and a clear policy roadmap for the new administration.

In a contrasting development, the Japanese yen was poised for its strongest weekly performance in more than a month as expectations of a Bank of Japan (BOJ) rate hike next week increased, weighing on the dollar.

DXY Index volatility chart over the past 24 hours. Photo: Marketwatch

The Japanese yen has gained more than 1% against the dollar this week, reversing last week's decline and hitting a one-month high of 154.98 against the dollar early in the session.

“The yen will remain tied to U.S. interest rates,” said Brad Bechtel, global head of FX at Jefferies. “I think the greenback’s weakness this week has helped to take some of the pressure off USD/JPY. The BOJ appears poised to raise rates next week, which should be positive for the yen. But with the interest rate differential still wide, it’s unlikely that USD/JPY will fall much further.”

Comments from BOJ officials coupled with Japanese data pointing to persistent price pressures and strong wage growth have helped boost market confidence that a rate change is in the offing, with traders pricing in an 80% chance the BOJ will raise rates next week.

Sources also told Reuters that the central bank is likely to raise interest rates next week unless there is any news that could have a strong impact on the market after Mr Trump's inauguration.

The dollar has surged in recent weeks as Treasury yields have risen, reflecting expectations that President-elect Trump's policies could spur inflation as the US economy stabilizes.

Federal Reserve Governor Christopher Waller said on January 16 that three or four rate cuts are likely this year. This has led markets to increase bets on the Fed cutting rates this year, putting pressure on the dollar ahead of Trump's return to the White House next week. Accordingly, the currency market is now pricing in a total of about 40 basis points of US interest rate cuts by 2025.

“In the wake of weaker-than-expected inflation data last week, investors have increased their expectations for a Fed rate cut from 25 to 40 basis points,” said Uto Shinohara, senior investment strategist at Mesirow Currency Management.

Markets will focus on Donald Trump’s new term and the impact his policies will have on the market. Investors are now waiting for Trump’s inauguration speech on January 20 to get a better understanding of his policy moves.

The pound fell 0.6 percent to $1.2166 after new data released on January 17 showed that UK retail sales unexpectedly fell in December, raising the risk of a fourth-quarter recession.

Meanwhile, the EUR also fell 0.26% to $1.0276.

USD exchange rate today, January 18: USD recovers to 109. Photo: Reuters

USD exchange rate today in the country

In the domestic market, at the beginning of the trading session on January 18, the State Bank announced the central exchange rate of the Vietnamese Dong against the USD increased by 8 VND, currently at 24,341 VND.

* The reference exchange rate at the State Bank's transaction office remains unchanged, currently at: 23,400 VND - 25,450 VND.

USD exchange rates at commercial banks are as follows: