EUR/VND Outlook:
The EUR/VND is likely to decrease as it is currently trading below its recent average and near recent lows. Factors such as geopolitical risks and rising energy prices put pressure on the euro, while the Vietnamese dong remains stable.
Key drivers:
• Rate gap: The European Central Bank is facing uncertain monetary policy challenges, while Vietnam is taking a cautious approach to monetary expansion.
• Risk/commodities: Rising oil prices are causing concerns for the euro as they worsen inflation risks and the economic outlook in the Eurozone.
• One macro factor: The euro is weakened by geopolitical tensions, particularly the ongoing conflict in the Middle East, leading to increased risk aversion among investors.
Range:
The EUR/VND may drift within the recent stable range of 30410 to 31441 but is unlikely to test the upper extreme.
What could change it:
• Upside risk: A de-escalation of geopolitical tensions could boost the euro.
• Downside risk: Continued rising oil prices impacting European growth could further weaken the euro.
