The US dollar is heating up globally.

The US dollar jumped on the free market

In just a few days, the world's leading central banks, including the US Federal Reserve (FED), the European Central Bank (ECB) and the Bank of Japan (BOJ), will release their latest views on monetary policy, which are expected to support the USD.

In the domestic market, after the first session of “chaotic trends”, the exchange rate today, July 25, increased quite strongly. In particular, the “heat” was concentrated in the free market when the US dollar skyrocketed.

At the Joint Stock Commercial Bank for Foreign Trade of Vietnam (Vietcombank), the listed exchange rate is: 23,495 VND/USD - 23,835 VND/USD, an increase of 10 VND/USD in both buying and selling compared to the end of yesterday.

USD rises globally 1 — The closer it gets to the time when global central banks are expected to announce new views on monetary policy, the hotter the US dollar gets globally. Illustration photo

Vietnam Joint Stock Commercial Bank for Investment and Development (BIDV) listed the USD/VND exchange rate at: 23,525 VND/USD - 23,825 VND/USD, up 5 VND/USD. Vietnam Export Import Commercial Joint Stock Bank (Eximbank) traded USD at: 23,530 VND/USD - 23,840 VND/USD, up 10 VND/USD. At Vietnam Technological and Commercial Joint Stock Bank (Techcombank), the buying and selling rates were: 23,518 VND/USD - 23,853 VND/USD, up 11 VND/USD for buying, up 13 VND/USD for selling.

Vietnam Joint Stock Commercial Bank for Industry and Trade (VietinBank) is a special case when the USD both increases and decreases. From the early morning of July 25, the exchange rate at VietinBank was traded at: 23,505 VND/USD - 23,845 VND/USD, an increase of 35 VND/USD for buying but a decrease of 45 VND/USD for selling.

In the free market, the USD is "hot".

At Hang Bac and Ha Trung, the "foreign currency streets" of Hanoi, the USD/VND exchange rate is commonly traded at 23,750 VND/USD - 23,820 VND/USD, an increase of 100 VND/USD for buying and 120 VND/USD for selling.

The US dollar is heating up globally.

The dollar rose against the euro after recent economic data showed a stronger US economy and a slowing euro zone as traders looked ahead to three central bank meetings this week for clues on the outlook for monetary policy.

A closely watched purchasing managers survey showed US business activity fell to a five-month low in July, dragged down by slowing growth in the services sector, but the data was better than similar surveys in Europe.

Falling US input prices and slower hiring suggest the Fed may be making progress on key fronts in its efforts to reduce inflation.

“When you look at the global picture, there are more reasons to be optimistic about the US than almost anywhere else, and that’s on par with the dollar,” said Adam Button, chief currency analyst at ForexLive in Toronto. “The US economy is really the best of the best.”

The euro fell 0.49% to $1.1069 while sterling was last trading at $1.2823, down 0.25% on the day, kicking off a busy week for central bank meetings with investors expecting interest rate hikes in Europe and the US.

The dollar index rose 0.247% to 101.330, while futures expect the Fed's overnight interest rate to rise to 5.43% in November and remain above 5% until June 2024.

The Japanese yen rose 0.24% against the greenback to 141.47 per dollar.

The Fed concludes its meeting on Wednesday, followed by the ECB a day later and the BOJ on Friday.

Investors expect both the ECB and the Fed to raise interest rates by 25 basis points, and the focus in both cases will be on the signals they send around their September meetings.

“The Fed is unlikely to raise rates again at its September meeting after this week’s hike, but with the U.S. economy looking better now, the euro is taking the brunt of the dollar,” said John Velis, head of Americas macro strategy at BNY Mellon Markets in New York.

Traders said the BOJ is the most likely of the three central banks to deliver a market-moving surprise, with an adjustment to its yield curve control policy seen as a possibility.

Source