Market Highlight 22.05.2025

The USD Index posted its third consecutive day of losses on Tuesday, declining by 0,32%, as investor sentiment was dampened by concerns over President Donald Trump’s proposed tax-and-spending bill and weak demand for the 20-year U.S Treasury bond auction. These developments have reinforced the view that U.S assets are becoming increasingly unattractive to global investors. President Trump is currently pushing for Republican support on a new tax package centered on deep tax cuts and tighter eligibility requirements for healthcare programs. Analysts estimate that the Bill could add between $3 trillion and $5 trillion to the federal government’s existing $36,2 trillion debt. Meanwhile, markets are closely watching for signals that U.S trade negotiators might be seeking a weaker dollar as part of standalone trade agreements, potentially discussed on the sidelines of the ongoing G7 Finance Ministers’ meeting in Canada.

In trade data, the United States remained Vietnam’s largest export market in the first four months of 2025, with export value reaching $43,41 billion, up 25,1% year-on-year and accounting for 31% of Vietnam’s total exports. On the import side, China continued to be Vietnam’s largest source of goods, with total imports hitting $53,16 billion, up 26,5% and representing 39% of the nation’s total import value. Notably, foreign-invested enterprises (FIEs) contributed significantly to Vietnam’s trade performance, with total import-export turnover reaching $184,38 billion in the January - April period, up 14% from a year earlier. Of this, exports accounted for $99,09 billion (+11,4%) and imports $85,29 billion (+17,1%).

On the interbank market, the USD/VND exchange rate edged higher to 25.975 on Tuesday following a $100 million foreign currency purchase by the State Treasury. Despite the dollar’s recent weakness in global markets, domestic foreign currency supply and demand remain broadly balanced, and market sentiment appears largely unaffected.

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