Market Highlight 22.05.2026

Business activity in the U.S remained steady in May, while slowing across Europe and Asia due to higher energy costs, suggesting that the global economy has weakened as a consequence of the conflict in the Middle East. The war has led to a sharp decline in cargo flows through the Strait of Hormuz, which normally carries one-fifth of the world’s oil and natural gas. As supplies have fallen, energy prices have surged globally. Concerned about the impact of the conflict, economists have revised down their forecasts for global growth this year. The United Nations now expects growth to be the weakest since the Covid-19 pandemic, or excluding that exceptional year, the weakest since the global financial crisis.

The surveys show that the expected slowdown is now taking place, although the U.S appears to be less negatively affected than Europe and Asia. S&P said the U.S Purchasing Managers’ Index (PMI), which tracks activity across both services and manufacturing, was unchanged at 51,7 in May. The result appears to reflect a boost to production from companies accelerating purchases in order to avoid even higher prices in the future, or from difficulties in securing supplies of essential products. Although the conflict in Iran appears to be slowing economic growth, it is also reigniting global inflation. This combination of weaker activity and rising inflation is putting Central Banks in a difficult position, because any measures they take to contain inflation could worsen the associated economic slowdown and job losses.

Domestically, interbank USD/VND maintained its upward momentum and touched 26.370 yesterday, with the effective daily ceiling set at 26.391.

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