USD prices in Vietnam ease amid robust supplies, Fed cut hopes

U.S. dollar prices in Vietnam, on both official and free markets, have been on the decline over the past month as greenback supplies rise and the Fed is expected to cut rates soon.

The reference USD/VND rate set by the State Bank of Vietnam on Monday rose VND7 from last Saturday to VND24,261 a dollar. With a trading band of ±5%, commercial banks are allowed to set their quotes at VND23,048-25,474.

State-run Vietcombank, the largest forex trader in the country, lowered its USD price to VND24,830-25,200 a dollar on Monday morning for bids and asks from VND24,860-25,230 last Friday and VND25,030-25,400 on August 1.

Compared to the beginning of this year, USD prices at Vietcombank have increased 3.2%, according to data from the bank.

Leading private lender Techcombank offered the dollar at VND24,810-25,201 for buying and selling, respectively, down from VND24,862-25,260 last Saturday.

Gold shops in major cities were offering the greenback at VND25,250-25,400, just VND200 above banks’ quotes and narrowing from differences of VND400-500 months ago.

USD prices on the free market have been nosediving over the past one month. Gold shops in Hanoi quoted the greenback at VND25,300-25,390 a dollar for buy and sell on Sunday, down VND150 from last Friday, marking a five-month low.

Compared to a peak of VND26,030 reached on June 27, free-market USD prices have dropped 2.3%.

The U.S. Dollar Index, which measures the U.S. dollar against a basket of currencies, is trading around 102.2, down from 102.98 last Friday.

The dollar weakens amid concerns over a U.S. economic slowdown and expectations for stronger-than-expected rate cuts by the Fed.

Domestically, Vietnam posted an estimated merchandise trade surplus of $2.12 billion in July, resulting in a surplus of $14.08 billion in January-July.

Registered foreign direct investment (FDI) reached $18 billion in the year to July 20, up 10.9% year-on-year, according to the investment ministry.