Forex, interest rate projections for Vietnam in 2026

Pressures on the exchange rate and interest rates have eased, but the Vietnamese dong is expected to continue facing depreciation pressure in 2026, say analysts.

On December 10, after a two-day policy meeting, the U.S. Federal Reserve cut its benchmark interest rate by 25 basis points to a range of 3.5-3.75%, marking its third policy adjustment this year.

However, signals from the Fed suggest it may pause further rate cuts while waiting for clearer signs from the labor market and inflation, which it said remains “fairly high.” New projections show policymakers expect one 25-basis-point rate cut in 2026.

Following the Fed’s move, USD/VND rates diverged between the banking system and the informal market. On the street market, the dollar rose by VND20-30 dong to VND27,120-27,180 per U.S. dollar.

The State Bank of Vietnam set the daily reference exchange rate at 25,148 VND/USD on Friday, down 6 VND from the previous day. With the current trading band of +/- 5%, the ceiling rate applicable for commercial banks during the day is 26,405 VND/USD, while the floor rate 23,891 VND/USD.

At 11.30 a.m. Friday, the buying rate at Vietcombank was 26,125 VND/USD and the selling rate VND26,405, down VND16 and VND6 from Thursday, respectively.

At Vietinbank, the buying and selling rates were 26,102 and VND26,405, up VND142 and down VND6, respectively.

For SeABank, the respective figures were 26,135 and 26,405, down VND36 and VND6 from Thursday.

Vietcombank and Vietinbank are state-controlled banks and among the Top 4 Vietnamese banks, while SeABank is a private bank. The above figures refer to payments via bank transfer, instead of cash.

The U.S. dollar index (DXY) also continued to decline, standing at 98.33.

Analysts said the Fed’s December 10 rate cut has eased pressure on Vietnam’s markets, particularly exchange rate and interest rate pressures.

Can Van Luc, BIDV bank’s chief economist and a member of the Prime Minister’s economic advisory council, said the Fed’s decision would help ease exchange-rate pressure and limit capital outflows.

He said the VND has heated up since earlier this year due to a sharp rise in foreign-currency demand. While the official rate has risen about 3.5% year-to-date, the street rate has climbed nearly 7%.

Rising demand has stemmed not only from imports but also speculation, sovereign debt repayments, and informal gold-import funding. He noted that USD prices have since cooled.

Regarding policy implications for the State Bank of Vietnam (SBV), Luc noted the central bank is likely to maintain current policy rates to support growth. He added that SBV policy rates - such as refinancing and rediscount rates - have limited direct impact on deposit and lending markets.

He said VND deposit rates have risen recently, which may push up lending rates at certain times and in certain sectors. Still, the banking system will aim to keep lending rates broadly stable in line with government and SBV directives to support growth.

Le Xuan Nghia, a member of the National Financial and Monetary Policy Advisory Council, forecast only mild depreciation of the VND ahead.

Explaining the recent surge in the street-dollar rate, he cited multiple factors, including year-end import demand amid ongoing corporate difficulties. In addition, some banks offer loans when depositing USD to profit from the interest rate differential between USD and VND, creating a demand for buying USD to deposit.

Banking expert Nguyen Tri Hieu said it is difficult for Vietnam to achieve low inflation, exchange-rate stability, and financial safety simultaneously. With Vietnam targeting GDP growth of more than 10% next year, he said monetary policy will come under significant pressure.

Hieu forecast the VND may weaken by 4-5% against the dollar in 2026, given FX needs for gold imports and strong credit growth targets.

Financial expert Huynh Trung Minh said the dong will remain under single-digit depreciation pressure in 2026. He predicted VND interest rates are unlikely to fall further and may even rise in the first half of the year to defend the currency and curb imported inflation.

Minh added that exporters may continue holding dollars for at least 6-9 months, and home or car buyers should consider locking in fixed rates in Q4/2025 or no later than Q1/2026, as funding costs are unlikely to remain low beyond mid-2026.

At a conference of Military Bank (MBBank) on November 7, Pham Nhu Anh, CEO of the military-run bank, said that the Vietnamese dong had already weakened 3.5% by October - or about 6% compared to the period last year - leaving little room for maneuver.

"The exchange rate has already reached the upper limit of the central bank’s tolerance band. The full-year target for VND depreciation is 3-5%, and there’s almost no room left to use this policy tool," he commented.