Market Highlight 30.12.2025

U.S President Donald Trump said overnight that he has selected a candidate for the position of the next Chair of the Federal Reserve, but will announce the decision at an appropriate time. Mr Trump didn’t specify who is the leading contender for the post and indicated that an announcement would likely be made around January. National Economic Council Director Kevin Hassett is widely viewed as the frontrunner, although Mr Trump has also expressed interest in former Federal Reserve Governor Kevin Warsh. The U.S President has long criticised current FED Chair Jerome Powell, whom he himself appointed to lead the Central Bank during his first term.

President Trump said he wants the next FED Chair to take a more assertive stance on cutting interest rates, as the White House seeks to lower borrowing costs across the economy. The Federal Reserve has reduced interest rates at each of its last 3 policy meetings, but policymakers signalled in December that they may only cut rates once more in 2026. Mr Powell’s term as Chair is due to end in May 2026, though his term as a member of the Federal Reserve Board of Governors does not expire until 2028. Mr Powell has not stated whether he would step down from the Board when his Chair term ends. Should he remain, this would prevent President Trump from appointing a new member to the FED’s policy-making body.

The USD Index edged slightly lower yesterday after rebounding over the previous two sessions, trading around the 98 level. Domestically, the USD/VND interbank exchange rate traded mainly around 26.290 at the start of this week. The State Bank of Vietnam lowered the central reference rate by VND 3 yesterday to 25.125, corresponding to an effective ceiling rate of 26.381. The downward trend in the exchange rate is expected to persist today, with the market moving towards the 26.200 - 26.250 range.

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