Bias: range-bound, as USD/VND sits near the 90-day average and in the lower half of the 3-month range, with limited near-term catalysts and traders awaiting US data and IMF cues.
Key drivers:
- Rate gap: US policy expectations for gradual easing in 2026 narrow the gap with Vietnam’s cautious stance, limiting USD strength.
- Macro factor: IMF approves currency adjustment for VND, underpinning dong stability for 2026.
Range: The USD/VND pair is likely to drift within the 3-month range, with a tilt toward the lower end if risk appetite weakens and domestic policy commentary stays cautious, with external shocks remaining a factor.
What could change it:
- Upside risk: stronger US data or a shift to tighter Fed policy could lift the dollar and pressure VND, especially if markets recalibrate expectations for the 2026 cycle.
- Downside risk: softer US data or larger-than-expected rate cuts could weigh on the dollar and support VND, particularly if domestic inflation remains contained and markets price in easing.
