Market Highlight 20.02.2025

The Federal Reserve’s policy meeting minutes from January 28-29, released early this morning, indicate that the FED is unlikely to cut interest rates anytime soon for the U.S economy. FED members unanimously agreed that strong consumer demand and policy shifts in trade and immigration pose potential risks that could hinder the progress of inflation control. Following the January meeting, FED Chair Jerome Powell stated that the central bank would need to see "clear signs of inflation cooling" or an unexpected labor market downturn before considering additional rate cuts. Subsequent economic data confirmed steady job growth in January, with the unemployment rate declining to 4% from 4,1% in December. Meanwhile, January CPI exceeded expectations, shifting market focus to next week’s PCE data release.

Safe-haven currencies such as the USD and JPY appreciated yesterday as market concerns escalated amid President Donald Trump’s latest tariff threats and heightened tensions in negotiations to end the war in Ukraine. The USD Index rebounded for the second consecutive session, rising 0,2% to 107,18, after posting a 1,2% decline last week. Trump reiterated his intent to impose a 25% tariff on automobiles and similar duties on semiconductor and pharmaceutical imports into the U.S.

The USD/VND exchange rate edged up by 20 VND yesterday, closing at 25.520. The State Bank of Vietnam continued raising the central exchange rate, setting it at 24.633 (+1,22% year-to-date), with an effective ceiling rate of 25.865. Meanwhile, the interbank exchange rate has increased by only 0,14% over the same period. Given the upward momentum of the USD in global markets, the exchange rate is expected to rise above 25.550 today.

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

- Financial Markets Division – Email: ktttc@acb.com.vn ; or

- Mr. Khanh Hoang (Financial Markets Senior Analyst) – Email: hoangnk@acb.com.vn