Central rate and bank rate
The central exchange rate announced by the State Bank this morning was 24,322 VND/USD, a slight increase of 12 VND compared to the end of last week.
At commercial banks, USD transactions are stable with buying and selling rates at Vietcombank being 25,208 - 25,538 VND/USD, and at BIDV being 25,218 - 25,538 VND/USD.
Meanwhile, the Euro maintained its buying price of VND25,817 and selling price of VND27,232 at Vietcombank. The Japanese Yen continued to fall sharply, trading at its lowest level in the past 5 months, near the threshold that could lead to intervention from Tokyo, with buying and selling prices of VND155.50 - VND164.54 at Vietcombank.
Global economic picture last week
The US dollar strengthened last week as the yield on the 10-year US Treasury note rose to 4.641%, its highest since May. The US dollar index remained above 108.2, indicating a strong growth trend for the greenback. These fluctuations were driven by expectations of a prolonged high interest rate from the Fed along with signs of a slight recovery from the US manufacturing sector.
However, the global manufacturing sector has yet to show much improvement. European manufacturing PMIs remain in contractionary territory, while China’s PMI, while better, is still barely holding steady.
New week forecast: Major influencing factors
Investors will focus on the S&P Global and ISM manufacturing PMI data this week, especially the US PMI. Experts say that the US manufacturing PMI may decline slightly from 48.4 to 48.3. If the producer price index in the PMI increases, this may support the USD, but if the data unexpectedly weakens, the pressure on the USD may increase.
Information related to President-elect Donald Trump's economic policies is also a factor to pay attention to. Moves related to tariffs, government spending, and fiscal policy can create strong fluctuations in the foreign exchange market.
Japanese Yen: Risk of intervention from Tokyo
The Japanese Yen continues to weaken amid a widening interest rate differential between the US and Japan. With a decline of more than 5% in December, investors are closely watching the possibility of the Japanese government intervening to stabilize its currency, which could be a big mover this week.
Recommendations for investors and businesses
For import businesses: Consider buying USD early to avoid the risk of higher exchange rates in the context that the Fed may maintain a high interest rate policy.
For exporters: Take advantage of the current high USD level to lock in foreign currency and ensure profits.
For investors: Closely monitor signals from the Fed and important economic data to have a reasonable investment strategy, while being cautious with the risk of volatility if Japan decides to intervene in the foreign exchange market.
Expert opinion
According to Vishnu Varathan, head of macro research at Mizuho Bank, the divergence in monetary policy between the Fed and the BoJ continues to be the main reason for the yen's weakness. Meanwhile, Jonas Goltermann of Capital Economics predicts that the dollar could continue to strengthen next year thanks to the outstanding performance of the US economy.
The global financial market picture for the new week promises many fluctuations as economic and political factors intertwine, especially in the context of 2024 ending with many important milestones.
