Market Highlight 18.07.2024

The USD Index continued its strong decline that falling nearly 0,5% yesterday and breaking through the significant support level of 104 points and targeting the next level of 102,7 points. This decline was supported by comments from several members of the FED's policy-making committee, indicating the agency is nearing the point of cutting interest rates for the U.S. economy. John Williams, President of the New York Federal Reserve and Vice Chairman of the FED's rate-setting committee, as well as a top policy advisor to Chairman Jerome Powell, stated that U.S. inflation data over the past three months is approaching the 2% target. However, he noted that more clear signals are needed for the FED to gain confidence before cutting rates. FED Governor Christopher Waller also expressed hope last night that the central bank could lower rates in a month or two with better inflation data.

The strong rise of the JPY (+1,35%) last night is attributed to potential currency intervention by the Japanese government, which significantly contributed to the further weakening of the USD. Data suggests Japan may have used approximately 36 Billion USD for intervention to support its currency over the past weekend, recovering the JPY from a 38-year low of 161,96 points to 155,5 points this morning.

The USD/VND interbank exchange rate decreased by an additional 45 Dong yesterday and was closed at 25.330. Although there were some foreign currency purchases for payments during the day, estimated at around 100 Million USD, the pressure from the weakening USD in the global market greatly influenced the downward trend in the market. The exchange rate is forecasted to continue its decline today, and if it fails to maintain the 25.300 level, the target range before the September FED meeting could be between 25.050 and 25.100.

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Directly contact us to receive market news and consultancy on foreign exchange products and derivatives:

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