Foreign exchange prices on October 23, 2024: USD hits 2.5-month peak, investors await Fed's adjustment

DNVN - On October 23, 2024, the central exchange rate of the Vietnamese Dong against the US Dollar increased by 12 dong, currently at 24,240 dong. The US Dollar today climbed to a new two-and-a-half-month high as investors expect the US Federal Reserve (Fed) to adjust its interest rate cut trajectory.

USD exchange rate in the international market

The Dollar Index (DXY), which measures the strength of the USD against six other major currencies such as EUR, JPY, GBP, CAD, SEK, and CHF, is currently at 104.07 points, down slightly by 0.09 points compared to the trading session on October 22, 2024.

Today, the USD reached its highest level in two and a half months, continuing its recent upward trend, as the market believes the Fed will change its interest rate cut trajectory, amid investors closely monitoring the tense US presidential election.

The US dollar has been rising for three consecutive weeks and is heading for its 15th gain in 17 trading sessions, as a series of positive economic data dampened expectations about the pace and scale of Fed interest rate cuts. This has driven up US Treasury yields.

The yield on 10-year U.S. Treasury bonds reached 4.222% on Tuesday, its highest level since July 26.

Based on CME's FedWatch tool, the market is currently pricing in an 89.6% probability that the Fed will cut interest rates by 25 basis points at its November meeting, while there is still a 10.4% probability that the Fed will keep interest rates at their current level. A month ago, the market was pricing in a certainty of at least a 25 basis point cut, with a 50.4% probability of a 50 basis point cut.

Thierry Wizman, global interest rate and foreign exchange strategist at Macquarie in New York, commented: “If U.S. economic data isn’t strong, or even weaker than in other regions, the divergence between the Fed and other central banks will widen. At least in terms of tone and communication, this is a key factor driving the continued strengthening of the dollar.”

The US dollar index, which measures the greenback against a basket of currencies including the Japanese yen and the euro, rose 0.12% to 104.08 points, after reaching 104.10 – its highest level since August 2nd. The index has gained approximately 3.3% this month and is on track for its strongest gain since April 2022. The British pound is currently down 0.04%, to $1.2979.

The upcoming US presidential election is also causing exchange rate fluctuations, as the market anticipates a potential victory for Republican presidential candidate, former President Donald Trump, who could implement inflation-related policies such as tariffs.

Wizman added: "As the prospect of a Trump victory became clearer, the market began to factor in the potential for increased inflation in the United States, as his agenda is more closely tied to inflation, especially compared to the policies of Democratic candidate Kamala Harris."

Domestic USD exchange rate

On October 23, 2024, the USD exchange rate continued to rise to a new two-and-a-half-month high due to expectations that the Fed would change its interest rate cut trajectory.

In today's trading session, the State Bank of Vietnam announced that the central exchange rate between the Vietnamese Dong and the US Dollar increased by 15 dong, bringing the current rate to 24,240 dong.

Currently, the exchange rate at commercial banks is allowed to fluctuate between 23,400 and 25,450 VND/USD. The State Bank of Vietnam's Exchange Transaction Department has also adjusted the USD buying and selling rate to between 23,400 and 25,450 VND/USD.

At Vietcombank , the buying and selling rates of USD are fluctuating between 25,062 and 25,452 VND. Currently, the USD buying and selling rates in the commercial banking system range from 24,000 to 25,500 VND/USD.

The Euro exchange rate at the State Bank of Vietnam's exchange floor recorded a slight decrease, currently at 24,904 VND for buying and 27,525 VND for selling.

The Japanese Yen exchange rate at the State Bank of Vietnam's exchange desk also decreased slightly, with the buying and selling rates currently at around 153 VND – 169 VND.

Thanh Mai (compiled)

Source: https://doanhnghiepvn.vn/kinh-te/gia-ngoai-te-ngay-23-10-2024-usd-dat-dinh-2-thang-ruoi-nha-dau-tu-cho-doi-dieu-chinh-tu-fed/20241023075552703