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 British Pound exchange rate 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) measures the greenback's fluctuations against six major currencies (EUR, JPY, GBP, CAD, SEK, CHF), recording at 102.40 points.

The USD price stagnated at the beginning of the week and then broke its upward trend. 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 could 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.

The USD Index hit a five-month low in December 2023 as inflation eased 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 leaving open the possibility of tightening policy, the market still believes 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 the inflation trend.

Jane Foley, senior FX strategist at Rabobank, commented: “Despite the correction in market prices this year, in our view, investors remain overly optimistic about the Fed rate cut. This outlook will be revised. Therefore, the USD will continue to be supported for about 1-3 months. EUR/USD will fall to 1.05 in 3 months before the Fed cuts interest rates in the second half of the year, causing the USD to fall.”

“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