On Wednesday morning, the U.S. dollar surged to an all-time high against the Vietnamese dong, intensifying its ascent while remaining at a three-and-a-half-year low against other major currencies.
The Vietcombank sold the greenback at VND26,323, reflecting a modest increase of 0.05% from the previous record of VND26,310 set on June 24. However, on the black market, the dollar retreated by 0.26% from Tuesday, trading at around VND26,440.
Since the beginning of the year, the U.S. dollar has appreciated by 3.02% against the dong, showcasing its growing strength in the local financial landscape.
This week, the State Bank of Vietnam responded by raising its reference rate by 0.05% to VND25,070, aiming to stabilize the currency’s value.
Globally, while the dollar soared against the dong, it faced challenges, hovering near its weakest levels since February 2022 against major counterparts. Market players are digesting dovish remarks from Federal Reserve Chair Jerome Powell and deliberating the potential implications of President Donald Trump’s spending bill, according to reports from Reuters.
Notably, the dollar index, which gauges its performance against six major currencies, crept slightly upward to 96.677, yet remained close to its earlier low of 96.373. The greenback stabilized at 0.7906 Swiss franc, recovering slightly from a dip to 0.7873 franc during the previous session.
The euro held steady at $1.1802, lingering near its overnight high of $1.1829, while sterling edged up to $1.37435, inching closer to Tuesday’s peak of $1.3787, a level not seen since October 2021. The dollar regained some ground against the yen, rising by 0.1% to 143.59 yen after a 0.4% decline in the previous session.
What does the recent increase in the dollar’s value against the Vietnamese dong indicate?
The rise signifies a growing strength of the U.S. dollar in Vietnam’s financial landscape, influenced by global market dynamics and local currency policy adjustments.
How has the State Bank of Vietnam responded to the dollar’s surge?
To combat the dollar’s increasing value, the State Bank raised its reference rate by 0.05% to VND25,070, aiming to stabilize the local currency.
What are the implications of Federal Reserve Chair Jerome Powell’s remarks for the dollar?
Powell’s dovish hints suggest a more cautious approach to interest rate hikes, impacting global perceptions of the dollar’s strength among traders worldwide.
