Market Highlight 07.07.2025

   The USD Index eased by 0,15% last Friday during the U.S holiday session after President Donald Trump’s administration cleared the final hurdle to pass a major tax cut Bill, while countries came under mounting pressure to finalize trade agreements with the United States ahead of the critical July 9 deadline. The previous day, the USD had climbed nearly 0,4% following stronger-than-expected U.S June employment data, which suggested that the Federal Reserve may postpone any potential interest rate cuts until September or later. The Republican-controlled House of Representatives passed President Trump’s “One, Big, Beautiful Bill,” which combines increased spending with significant tax cuts and is projected to add an estimated USD 3,4 trillion to the nation’s current USD 36,2 trillion debt load. Meanwhile, investor attention is squarely focused on the approaching July 9 deadline, when reciprocal tariffs are set to take effect, while many other major economies have yet to secure trade deals with the U.S.
   The USD has recorded its steepest first-half decline since 1973, as President Trump’s sweeping but loosely defined tariff measures have stoked fears of prolonged uncertainty for the U.S economy. On Monday this week, President Trump is expected to send formal letters announcing new tariff rates - potentially ranging from 20% to 50% - which will take effect after August 1 for twelve countries that have not reached a trade deal with the U.S. The market’s focus this week will be on the specific reciprocal tariff levels for the broader group of fifty target countries that the U.S plans to announce.
  The USD/VND interbank exchange rate posted a sharp decline on Friday but still ended the week nearly 100 VND higher overall. Market participants will closely watch the finalized tariff levels for several Asian exporters this week, following Vietnam’s status as the third country to reach a tariff agreement with the U.S. The exchange rate is projected to moderate this week, trending back toward the 26.000 - 26.100 range.

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