Will the USD continue to rise strongly?

The USD Index (DXY), which measures the greenback's performance against six major currencies, stood at 103.19, up 0.50%.

Forecast of USD trend this week

The US dollar has been on a good run for the second week in a row. The DXY index broke out of the 101-103 range on the upside and closed the week at 103.20. A sharp rise in Treasury yields helped the greenback index rise last week.

Chart of DXY Index fluctuations over the past week. Photo: Marketwatch.

Some members of the US Federal Reserve (Fed) have commented that the current situation does not yet warrant a pause in interest rate increases. However, on May 19, Fed Chairman Jerome Powell hinted in a speech that an early pause in interest rate increases would be expected. Therefore, with these conflicting views, the results of the next Fed meeting on June 14 will be the focus of the market. The central bank's economic forecasts will also be announced at that meeting.

The DXY index has seen a breakout above 103. The support level for the index is at 103; while 102.50-102 will be the next strong support zone. As long as the index remains above 102, the outlook for the greenback is bullish. The USD index could rise to 105 in the coming weeks.

Conversely, in case the Index falls below 102, the greenback could witness a slight correction later.

On the other hand, the drop to the 1.08-1.0780 zone for the euro was exactly as predicted last week. The currency fell below 1.0780 and hit a low of 1.0760, although it has since bounced back from this low, but the overall picture remains rather bleak. Resistance for the euro is at 1.0880-1.09.

The euro could fall to 1.07 this week, the next key support level. A rebound from around 1.07 could trigger a slight rally towards the 1.08-1.09 range. Price action around 1.07 will need to be closely watched this week.

USD exchange rate today, May 22: Will the USD continue to increase strongly? Illustration photo: Reuters.

Domestic USD exchange rate today

In the domestic market, at the end of the trading session on May 19, the State Bank announced the central exchange rate of the Vietnamese Dong against the USD to be stable, currently at: 23,680 VND.

* The reference exchange rate at the State Bank's transaction office increased slightly, currently at: 23,400 VND - 24,814 VND.

USD exchange rates at commercial banks are as follows: