Market Highlight 16.10.2026

The U.S Producer Price Index (PPI) rose by 1,3% in September, compared with a 0,4% increase in August. Higher costs for both goods and services were the main drivers, indicating that inflationary pressures are spreading beyond the energy sector. This was also the largest increase in the index since March 2022. Meanwhile, September retail sales rose by 0,8% to 745 billion USD, supported by higher gasoline prices, but slowed from the 1,3% increase recorded in August. Initial jobless claims edged higher last week, while consumer demand in the U.S remained strong and the labor market stayed stable. The September inflation reports further strengthened the case for the Federal Reserve (FED) to raise interest rates one more time before the end of this year. The USD Index fell by more than 0,5% on Thursday as renewed concerns over the debt burden of AI companies drove capital back into U.S Treasury bonds as a safe-haven asset.

Markets are currently pricing in more than a 70% probability that the FED will keep interest rates unchanged at its 27 - 28 October meeting, compared with 55% a month ago. Expectations of a FED rate hike had risen sharply following the CPI report, but comments from several FED officials, including Vice Chair for Supervision Michelle Bowman and San Francisco FED President Mary Daly, suggested that the Central Bank could wait for additional data in the coming months to assess the health of the U.S economy more accurately. Markets will also closely watch remarks by FED Chair Kevin Warsh at the IMF - World Bank Annual Meetings in Bangkok tonight for signals on the FED’s next policy move.

Interbank USD/VND fell by around VND 25 yesterday and closed the day at 25.875. The effective daily ceiling was adjusted lower to 26.924.

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