Market Highlight 24.06.2025

   The USD Index declined by 0,43% on Monday, retracing some of its recent gains, as several Federal Reserve policymakers indicated that the U.S central bank should soon consider cutting interest rates. Their comments came amid rising expectations that Iran’s response to the U.S airstrikes over the weekend would be relatively restrained. FED Vice Chair for Supervision, Michelle Bowman, stated that a rate cut could be approaching, citing growing concerns about risks to the labor market and expressing less emphasis on the inflationary impact of tariffs. On Friday, FED Governor Christopher Waller - widely seen as a leading candidate to succeed Jerome Powell as FED Chair - suggested the central bank should consider lowering rates at its next policy meeting scheduled for July 29 - 30. Chicago FED President Austan Goolsbee also remarked on Monday that, to date, President D. Trump’s tariff hikes have had a more modest impact on the U.S economy than previously feared. FED Chair Jerome Powell is set to testify before Congress on Tuesday and Wednesday regarding the conduct of monetary policy during the first half of 2025. Markets will be watching closely for any signals he may provide this evening regarding the timing of further interest rate cuts.
  Meanwhile, the USD/VND interbank exchange rate rose by an additional 70 VND on Monday, reaching a new all-time high of 26.220. The rate was buoyed by sustained USD strength in global markets - driven by ongoing geopolitical tensions in the Middle East - and robust domestic demand from corporates. Early Tuesday, initial signs of easing tensions between Israel and Iran began to emerge. As a result, the exchange rate is expected to dip slightly at the start of the day, but will likely remain elevated, trading in the 26.150 - 26.240 range, given continued strong demand for USD in the domestic market at the close of June.

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