Market Highlight 20.11.2024

The USD Index briefly surged to 106,6 yesterday amidst escalating tensions in the Ukraine conflict before cooling off by the end of the day due to diplomatic interventions. The USD has appreciated nearly 9% against the JPY to $156,74 since the beginning of October, increasing the likelihood of Japanese government intervention to support its domestic currency. The recent rise in the USD Index reflects growing expectations that the U.S Federal Reserve may slow the pace of their rate cuts, coupled with concerns that policies under President-elect Donald Trump could spur inflation. Kansas City FED President Jeffrey Schmid stated last night that he remains uncertain about how much further rates might be reduced but emphasized that recent rate cuts suggest confidence that inflation is trending toward the 2% target. Market forecasts for the pace of FED rate reductions have moderated compared to 2 months ago, with the probability of a 0,25% rate cut at the December meeting now at approximately 60%. 

Vietnam’s textile and garment exports for the first 10 months of 2024 were estimated at $36,11 billion, up 9,86% compared to the same period in 2023. Garment exports alone contributed approximately $28,38 billion, an increase of 10,54%. The United States remained the largest export market, accounting for $16,71 billion, up 12,33% year-on-year, representing 37,98% of Vietnam’s total textile and garment export turnover. 

The USD/VND exchange rate continued to trade within a narrow range around 25.400 for the second consecutive day yesterday. This trend is expected to persist through late November, supported by USD demand from businesses. However, the exchange rate is anticipated to gradually cool as the USD Index retreats below the 105-point threshold.

Asia Commercial Joint Stock Bank assumes no responsibility or liability for any purpose of reference or using the information provided by this newsletter.

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