Market Highlight 08.01.2025

Spot container shipping rates for goods from Asia to the United States have risen sharply over the past month, as businesses aim to dispatch orders ahead of potential U.S tariff increases in 2025. Many U.S importers are also boosting their inventory levels due to the risk of strikes at ports handling nearly half the maritime trade of the world’s largest economy. According to data from Xeneta, the spot rate for a 40-foot container destined for the U.S West Coast from Asia stood at $6.000 as of January 1, a 50% jump from $4.004 the previous month. Costs to the East Coast were $7.100, up 31%. For over a year, most container fleets have largely avoided passing through the Red Sea. Prolonged routes have reduced shipping capacity and kept container freight rates high for much of 2024. A potential large-scale strike at East Coast ports by the end of this month, along with higher tariffs on U.S imports - as previously announced by President-elect Donald Trump - adds further complexity. Forecasts suggest that elevated global shipping costs may persist through the first quarter of this year, before easing later in 2025.

The USD Index rebounded by nearly 0,4% yesterday, buoyed by late-day U.S economic data indicating a generally stable labor market and a strong acceleration in the service sector for December. This development reinforces expectations that the Federal Reserve may slow the pace of rate cuts in 2025. Markets currently place a 95% likelihood that the FED will keep policy rates unchanged at its January meeting, while the next feasible rate cut is widely anticipated in July 2025. Domestically, the USD/VND exchange rate fluctuated within a narrow range yesterday, closing at 25.375. The market is expected to remain between 25.350 and 25.400 today.

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