USD/VND Outlook:
Bearish, as the rate is below its recent average and close to recent lows, driven by the Federal Reserve's steady interest rates.
Key drivers:
• Rate gap: The Federal Reserve's decision to hold interest rates steady contrasts with weaker interest in dollar-denominated assets, putting downward pressure on the USD.
• Risk/commodities: The USD is facing challenges from geopolitical tensions, which have led to a reduction in demand for U.S. assets globally.
• One macro factor: Increased volatility in trade policies and investor apprehension over the "Sell America" trend is causing concerns about U.S. economic prospects.
Range:
Expect the USD/VND to drift within its recent range as conditions remain stable but bearish.
What could change it:
• Upside risk: A significant positive shift in U.S. jobless claims data could boost USD demand.
• Downside risk: Further geopolitical tensions or negative trade policies could further weaken the USD against the VND.
