USD/VND Outlook:
The USD/VND pair is slightly positive, but likely to move sideways as it trades just below its recent average and near the mid-range of the past three months.
Key drivers:
• Rate gap: The US Federal Reserve's recent interest rate cuts may place downward pressure on the USD against the VND.
• Risk/commodities: The US dollar has shown resilience due to strong jobs data, which could stabilize its strength against the VND.
• One macro factor: Vietnam's tight liquidity issues, alongside a significant trade surplus, highlight domestic pressures that support demand for USD.
Range:
Expect the USD/VND to drift within its recent 3-month range, given the current trading levels.
What could change it:
• Upside risk: A stronger-than-expected recovery in the US labor market could bolster the USD.
• Downside risk: Further tightening of liquidity in Vietnam could weaken the VND, affecting its exchange rate against the USD.