Market Highlight 20.04.2026

The global economic impact of seven weeks of war in the Middle East will begin to show more clearly this week, through a second round of business surveys across multiple countries. The key issue will be whether the twin shock to growth and inflation, reflected in PMI readings after the first month of the Iran conflict, has intensified further in the second month. Preliminary April economic data from Australia, Europe, and the U.S are due on Thursday. PMI readings in Germany, France, the euro area, and the UK are expected to weaken, while the U.S figures are seen changing little. Overall, this round of results may provide a clearer indication of the stagflationary dynamics that S&P Global had already warned about in its March PMI risk assessment. Last week, the IMF also warned of a range of potential risks, including the possibility of a global recession. Even with the current ceasefire in the Middle East, the damage to growth and inflation is unlikely to be reversed quickly. 

The most important U.S economic release this week will be retail sales. Headline retail sales are expected to post a strong increase in March, largely driven by a surge in gasoline spending. Meanwhile, nominee Kevin Warsh is scheduled to appear before the Senate Banking Committee on Tuesday. The market will closely watch for policy signals from the prospective next FED Chair, especially on how monetary policy might respond to President D. Trump’s preference for lower interest rates without undermining an economy that is still coping with war-driven inflation pressures from the Middle East. 

Domestically, interbank USD/VND closed last week at 26.335. This has also remained the market’s main trading range for more than two weeks as participants continue to wait for clearer signals from developments in the Middle East.

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