Market Highlight 27.10.2026

Slower economic growth is one of the reasons why the European Central Bank may decide not to raise interest rates this week. While much of the attention is focused on France’s fiscal difficulties and bond market pressures, data due on Friday could show that euro-area growth slowed in Q3, reducing the urgency to tighten monetary policy further to contain inflation. Forecasts suggest that European economic growth slowed to +0,2% in Q3 from a strong +0,6% in Q2. The resilience of the European economy since the outbreak of the Iran war may now be weakening, with business activity beginning to deteriorate amid energy shortages. As a result, the European Central Bank (ECB) may wait until December to deliver its third policy rate hike of the year rather than acting this week, keeping the rate unchanged at 2,5%. Euro-area inflation rose to +3,8% in September from +3,2% in August. However, most of the increase was driven by energy prices, while prices of manufactured goods declined.

The EUR fell by 0,26% against the USD to 1,1174 yesterday, pressured by a weaker economic growth outlook and persistently high energy prices in Europe. Brent crude futures edged lower but remained close to a six-month high at 115,81 USD/barrel yesterday, putting additional pressure on economies that are heavily dependent on energy imports, including the euro area.

Interbank USD/VND traded steadily around 25.830 - 25.860 and closed Monday at 25.840. Although the USD Index is showing signs of recovery ahead of the FED meeting and the release of U.S PCE data, the domestic exchange rate remains under downward pressure as foreign currency supply in the market continues to be abundant.

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