Market Highlight 10.09.2024

   China’s consumer inflation accelerated in August at the fastest pace in 6 months. However, this increase was driven more by rising food costs, affected by recent extreme weather conditions, rather than a recovery in domestic demand, while deflation in the production sector worsened. China’s Consumer Price Index (CPI) rose by +0,6% year-on-year, higher than the +0,5% increase in July, but still below the forecast of +0,7%. Meanwhile, the Producer Price Index (PPI) for August fell by -1,8% compared to the same period last year, marking the largest decline in 4 months.
   The USD Index rose by more than 0,4% on the first trading day of this week amid expectations that U.S inflation data for August, set to be released tomorrow evening, will continue to show signs of cooling, while the market has also lowered its expectations for a significant rate cut by the FED next week. Since the beginning of September, the USD has recorded a slight decline of about -0,1% after 2 months of significant losses (-4%). Attention is now focused on the U.S Consumer Price Index (CPI) report due on Wednesday evening, although the FED recently indicated that the labor market, rather than inflation, remains the primary focus of its policy adjustments. Forecasts suggest that the overall CPI for August in the U.S is expected to decrease to +2,6% year-on-year, down from +2,9% in July. Previously, the U.S jobs report for August, released last Friday evening, failed to clarify whether the FED would cut its policy rate by 0,25% or 0,5% next week.
   The USD/VND interbank exchange rate rebounded by about 75 dongs yesterday, following the recovery of the USD on global markets. By the end of the day, the exchange rate traded at 24.695, reflecting a recovery of nearly 120 dongs from last week’s low. It is forecasted that the exchange rate will continue its slight upward trend today, but primarily remain around the 24.700 level.

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