Market Highlight 18.06.2024

The USD Index slightly decreased by nearly 0,2% yesterday as the EUR recovered (+0,3%) but the market continues to closely monitor the political instability in Europe. Opposition parties in France stated that, despite holding an advantage in the upcoming early July parliamentary elections, they have no plans to request President Emmanuel Macron's resignation and will respect the country's traditional institutions. The French financial market has stabilized after witnessing a sharp decline last week.

Notable economic data last night showed that the import prices of U.S. goods fell for the first time in five months, combined with recent data reinforcing the view that inflation is somewhat being better controlled, increasing expectations that the FED will cut interest rates in September this year (nearly 60% likelihood). Previously, in the policy outlook update last week, the average interest rate level announced by the 19 members of the FED's policy-making committee leaned towards the possibility of only one interest rate cut this year. Philadelphia FED President Patrick Harker stated last night that, according to his economic forecasts, the FED will only cut the base interest rate once this year. The market is expecting that if U.S. economic data continues to show a weakening trend in the coming months, the FED will have to adjust its calculations in the policy outlook update in September.

The USD/VND interbank exchange rate remained around the SBV's USD selling price of 25.450 yesterday that continuing the main trend for nearly the past two months. It is forecasted that the interbank exchange rate will continue to be traded within a narrow range around 25.450 today.

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