USD price rises, FED may cut interest rates

How much is 1 USD in VND today?

State Bank of Vietnam exchange rate is at 23,976 VND/USD.

Vietcombank USD exchange rate is currently at 24,260 VND - 24,630 VND (buy - sell).

Vietcombank Euro exchange rate is currently at 26,137 VND - 27,572 VND (buy - sell).

The current Japanese Yen exchange rate is 163.45 VND - 173.00 VND (buy - sell).

The current exchange rate of British Pound is 30,398 VND - 31,692 VND (buy - sell).

Today's Yuan exchange rate is at 3,343 VND - 3,486 VND (buy - sell).

USD price today

The US Dollar Index (DXY), which measures the greenback's movements against six major currencies (EUR, JPY, GBP, CAD, SEK, CHF), recorded 102.40 points.

The USD price slowed down at the beginning of the week and then broke its upward streak. However, on Wednesday, the USD price continued to climb, maintaining the growth momentum from the beginning of the year. The focus of the foreign exchange market last week was on US economic data to predict when the Federal Reserve might cut interest rates.

Accordingly, US consumer prices increased in December due to a 0.3% increase in rents for the month and a 3.4% increase annually. The US producer price index (PPI) unexpectedly decreased by 0.1% last month. This made the market more optimistic, thinking that the Fed will soon cut interest rates.

Earlier in December 2023, the USD Index hit a five-month low as inflation fell closer to the 2% annual target and US economic data showed signs of weakness. A sell-off in the greenback is expected later this year. Expectations for the Fed are likely to continue to support the USD.

The CME Fed Watch tool shows that despite the tough message from Fed officials when they left open the possibility of tightening policy, the market still believes that the Federal Reserve will cut interest rates in March. The current probability is 79%.

According to Cleveland FED President Loretta Mester, based on the latest CPI data, it is still too early to cut policy interest rates in March. Richmond FED President Thomas Barkin commented that this data does not help clarify inflation trends.

“Despite the correction in market prices this year, in our view investors remain overly optimistic about the Fed’s rate cuts. This outlook will be revised. As a result, the USD will remain supported for 1-3 months. EUR/USD will fall to 1.05 in 3 months before the Fed cuts rates in the second half of the year, sending the USD lower,” said Jane Foley, senior FX strategist at Rabobank.

“The overall macroeconomic picture is not one that warrants a rate cut, but the market is very excited about it,” said Steve Englander, G10 FX strategist at Standard Chartered Bank in New York.

Source