Market Highlight 28.06.2024

The USD weakened against most major currencies yesterday (-0,12%) due to weaker data from the labor market, durable goods orders, and home sales in the U.S. The Q1 GDP in the U.S., in its final revision, recorded a +1,4% increase compared to the same period last year but this was a sharp drop from the growth rate of +3,4% in Q4 2023. However, consumer activity in the GDP report showed weaker growth, reaching only +1,5% compared to the +2% in the most recent update. The slowdown in consumer spending indicates less optimistic growth prospects for Q2 in the U.S. In a noteworthy statement last night, Atlanta FED President Raphael Bostic mentioned that if conditions to monitor the economy are in right direction, a rate cut in Q4 this year is more feasible. This reduces the likelihood of the FED initiating its first rate cut in September this year, a scenario the market has been heavily anticipating recently.

Meanwhile, the first debate between incumbent U.S. President Joe Biden and former President Donald Trump will attract market attention alongside the important inflation report (PCE) to be released tonight. A win for Mr. Trump in the debate would strengthen the USD, as his policies are seen to promote growth along with increasing inflation pressures in the U.S. The next resistance levels for the USD Index at 107 and 108,5 seem unlikely to be tested in the short term, given the forecast for weaker inflation data in the U.S. for May.

The USD/VND interbank exchange rate adjusted down by about 7 Dong at the end of yesterday which was traded around 25.450. However, the free market rate continued its strong rise and has now exceeded 26.000. The market is expected to trade stably today while awaiting important U.S. economic data, which could significantly impact the USD's trend in the coming period.

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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