USD exchange rate today (May 5): USD is trying to recover

The USD Index (DXY), which measures the greenback's performance against a basket of six major currencies, stood at 100.04.

Forecast of USD trend this week

The DXY index struggled to maintain its upward momentum for the second consecutive week.

The greenback’s price action over the past few weeks has shown that it is trying to recover. However, data released over the past week has failed to provide any bullish momentum for the greenback.

The US Personal Consumption Expenditures (PCE) index, the Federal Reserve's inflation gauge, came in at 2.29% in April, down from 2.69% the previous month. Meanwhile, the US unemployment rate remained unchanged at 4.2%.

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

In addition, a report from the US Department of Commerce last week also showed that the gross domestic product (GDP) fell 0.3% in the first quarter, affected by an increase in imports aimed at purchasing goods before the Trump administration imposed tariffs on most goods. In addition, pre-tax imports also increased 41.3% in the first three months of the year.

However, the yield on the 10-year US Treasury note, currently at 4.31%, rose sharply after the jobs data was released over the weekend.

The Fed meeting will be a key event to watch this week. Markets expect the Fed to keep interest rates unchanged at 4.25-4.5%. Markets are looking to Fed Chairman Jerome Powell's press conference to hear his comments on tariffs and how they might impact their future rate decisions.

Current resistance for the DXY is at 100.60. The DXY could rise to 101.50 or 102 if it breaks above the 100.60 resistance. But this is just a corrective rally within the overall downtrend. The DXY needs to break above 102 decisively to reverse the current downtrend and turn the outlook bullish. Only then will a rally to 104 and 106 be possible.

Failure to rise above 102 will maintain the downtrend. This will push the DXY index down to 96 in the coming weeks.

On the other hand, EUR/USD is currently witnessing a corrective decline. The index could fall to 1.12 or even 1.1150. But after this decline, the possibility of the EUR reversing and continuing the uptrend is very high. Such a rally would likely take the currency to the 1.16-1.18 zone. It would also open the door for the EUR to eventually reach the 1.20 target in the medium term.

The US 10-year Treasury yield has rebounded sharply from a low of 4.12% this past week. Current support for the yield is at 4.25-4.2%. If the yield remains above 4.2%, it is likely to rise to the 4.5-4.6% range again in the coming weeks.

Conversely, if the 10-year yield falls below 4.1%, it will come under pressure again. Only then will the risk of a drop to the 3.9-3.8% range emerge.

USD exchange rate today 5-5: USD is trying to recover. Photo: Reuters

Domestic USD exchange rate today

In the domestic market, at the beginning of the trading session on May 5, the State Bank announced the central exchange rate of the Vietnamese Dong against the USD at 24,956 VND.

* The reference exchange rate at the State Bank's transaction office for buying and selling remains unchanged, currently at: 23,759 VND - 26,153 VND.

USD exchange rates at commercial banks are as follows: