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Tag: dollar

  • Dollar drops on black market

    Dollar drops on black market

    The U.S. dollar plunged on the black market Wednesday after data shows a decline of the greenback’s value globally as U.S. inflation seems to be cooling down.

    The dollar fell 0.48% from Monday to VND25,000 at unofficial exchange points. It has dropped 1.96% since the peak of VND25,500 last month.

    Vietcombank, Eximbank and several other lenders kept the exchange rate unchanged from Tuesday at VND24,860. The State Bank of Vietnam (SBV) also maintained its reference rate at VND23,677.

    The USD Index, which measures the greenback’s strength against major currencies, has fallen 5.3% since its peak in early September.

    Data last week had shown that U.S. inflation cooled more than expected in October, raising bets that the Fed could temper its tightening cycle after delivering four consecutive 75 basis point hike this year.

    Goldman Sachs said it expects a “significant” decline in U.S. inflation next year due to easing in supply chain constraints, a peak in shelter inflation and slower wage growth.

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  • Dollar hike spikes iPhone prices

    Dollar hike spikes iPhone prices

    Electronic retailers have hiked iPhone prices by around VND1 million (around $40) as the U.S. dollar strengthens against the Vietnamese dong.

    The prices of iPhone 11 has increased from VND10.7 million last week to VND11.3-11.7 million this week, that of iPhone 13 from VND18.5 million to VND19.1-19.3 million, and iPhone 13 Pro Max from VND27 million to VND28-28.5 million.

    The U.S. dollar has risen 8.55% over the Vietnamese dong since the beginning of this year.

    Most retailers have hiked prices of older models like iPhone 12 and iPhone 13 Series by more than 5%, but kept those of the latest model, iPhone 14, unchanged to attract customers.

    However, many dealers say that the selling prices of iPhone 14 will also increase sooner than later because of the exchange rate.

    A 24hStore manage told Tuoi Tre newspaper that iPhone 14 prices are likely to go up by more than VND1 million, and that of iPhone 14 Pro by more than VND2 million.

    Since the U.S. dollar has risen against the Vietnamese dong to nearly VND25,000, the selling prices of other new products of Apple, including iPad Pro M2, iPad Gen 10, MacBook and Apple Watch, as well as their accessories such as styluses and keyboards, have increased by 5-7%.

    A CellphoneS store manager said most importers and distributors of Apple products and related accessories such as charging cables and speakers have hiked their selling prices by 5-10%.

    Some others, which have yet to increase prices, have cut promotions.

  • Vietnamese currency falls to record low against dollar

    Vietnamese currency falls to record low against dollar

    The dong depreciated to a new low against the U.S. dollar Wednesday morning, with state-owned Vietcombank selling the greenback at VND24,620 at 11.30 a.m.

    The Vietnamese currency fell 0.12% from Tuesday and 7.24% since the beginning of the year. Eximbank sold the dollar at VND24,620, 0.24% higher than Tuesday, and Techcombank at VND24,680, 0.33% higher.

    The U.S. Dollar Index, which measures the currency’s strength against six major currencies, is at the highest level since 2002 of around 112.

    Analysts expect the dong to come under more pressure from a surging dollar in the remaining months of this year since the State Bank of Vietnam does not have much reserves left to defend the dong after selling around 20% on it so far this year.

    As up to 70% of all trade contracts in Vietnam are paid in dollars, its continuing strength is bad news for businesses.

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  • Dollar rises to all-time high against Vietnamese dong

    Dollar rises to all-time high against Vietnamese dong

    The U.S. dollar continued to strengthen and reached its historic high against Vietnamese currency Saturday.

    The State Bank of Vietnam (SBV) on Saturday morning set the reference rate for the Vietnamese dong at VND23,283, the same as Friday and VND50 higher than early this week.

    At commercial banks, the Vietnamese dong is at its lowest in history.

    Vietcombank, the country’s largest lender, has sold the U.S. dollar for VND23,795, up more than 3.8 percent from the beginning of this year.

    Top private player Techcombank’s rates were VND23,810, Eximbank’s were VND23,790, and Sacombank VND23,967.

    The SBV allows the Vietnamese dong to trade within a band of 3% on either side of the reference rate, which is based on eight currencies and set daily.

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  • Cryptocurrency poses risk of money laundering

    Cryptocurrency poses risk of money laundering

    There is a big risk that cryptocurrencies will be used in Vietnam for laundering money since there is no legal framework to regulate them, a lawmaker has said.

    Vietnam is among the top countries globally in terms of cryptocurrency ownership but it does not even recognize the asset, Duong Van Phuoc from the central province of Quang Nam said at a meeting Wednesday.

    “Cryptocurrencies could be used by criminals to fund terrorism,” he said, adding that digital asset criminals are not getting caught due to the lack of regulations.

    He called for including cryptocurrencies and other digital assets in money laundering laws.

    State Bank of Vietnam governor Nguyen Thi Hong said there have been similar proposals before but the government has yet to decide which authority could be entrusted with overseeing them.

    According to digital currency payment company Triple A, around 5.96 million Vietnamese, or 6.1% of the population, own cryptocurrencies.

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  • US gets its way as Vietnam agrees not to devalue currency

    US gets its way as Vietnam agrees not to devalue currency

    The U.S. Trade Representative’s office has determined that no tariff action is warranted against Vietnam after its central bank agreed to refrain from “competitive devaluation” of the dong.

    “I commend Vietnam for its commitment to addressing U.S. concerns with its currency practices,” U.S. Trade Representative Katherine Tai said in a statement.

    The recent agreement between the U.S. Treasury and the State Bank of Vietnam “provides a satisfactory resolution of the matter subject to investigation and accordingly that no trade action is warranted at this time,” the statement said.

    Under the agreement, Vietnam committed not to devalue its currency for trade advantage and to make its monetary and exchange rate policies more transparent.

    The deal follows months of U.S. pressure and a rising trade surplus with that country.

    The U.S. had declared Vietnam a currency manipulator and threatened to impose punitive tariffs on its exports.

    Vietnam rejected this repeatedly, saying it did not manipulate its currency for unfair trade advantages.

  • Vietnam currency to remain stable throughout the year

    Vietnam currency to remain stable throughout the year

    Vietnam’s currency will likely remain stable this year as the greenback weakens and foreign exchange reserves rise, experts say. The reference rate set by the State Bank of Vietnam (SBV) has remained mostly stable this year and was at VND23,205 Tuesday.

    Rates at commercial banks for the last two months have also been stable. Vietcombank was selling the dollar for VND23,270 Tuesday morning. Ngo Dang Khoa, head of global markets at HSBC Vietnam, said that the VND/USD exchange rate will remain stable for the last four months thanks to a weakened dollar, Vietnam’s record-high trade surplus in the first eight months, and the record-high currency exchange reserves of the SBV.

    A poll of 75 foreign exchange strategists showed that 45 of them, or 60 percent, said the dollar would weaken slightly over the coming year. Analysts said the U.S. Federal Reserve’s policies have been the main reason for the dollar weakening sharply over the last four or five months. The Fed announced last week that it would tolerate periods of higher inflation and focus on employment.

    “So they’ve basically slashed rates to zero, that yield differential in America over the rest of the world is compressed and that obviously helped keep the dollar at such strong levels in previous years, which is no longer the case,”  quoted currency economist Lee Hardman as saying.

    Vietnam’s trade surplus climbed to a new peak of $11.9 billion in the first eight months as imports declined due to the fallout of the novel coronavirus pandemic, according to the General Statistics Office. A trade surplus increases the country’s supply of foreign currency.

    Prime Minister Nguyen Xuan Phuc on September 4 said that Vietnam’s foreign exchange reserves were at nearly $92 billion and could reach $100 billion by the end of the year.

    However, analysts from brokerage Bao Viet Securities said the SBV could slightly weaken the dong in the upcoming months amid the U.S. watching several countries, including Vietnam, for currency manipulation, or the use of unfair currency practices to gain trade advantages.

    A Vietnamese currency expert who asked not to be identified said that although Vietnam’s currency reserves have been increasing, it was still lower than other countries.

    The government has also been working closely with American authorities to prove that Vietnam is not intentionally using currency as a tool to boost exports, he added.

    Vietnamese authorities have repeatedly affirmed that the country does not use monetary policies to unfairly compete with trading partners.

  • Australian dollar back up

    Australian dollar back up

    The Australian dollar rebounded overnight and is buying 67.69 US cents Wednesday, up from 67.25 US cents on Tuesday.

    Yesterday, the local currency neared its decade low before rebounding. The Aussie dollar dipped to close to a recent 10-year low on weak retail sales figures.

    The Aussie dollar dipped as low as 66.88 US cents after the Australian Bureau of Statistics announced that retail spending fell by an unexpected 0.1 percent in July.

    But it later rebounded from that level – not far from a 10 and a half year low set of 66.77 cents set on August 7 – when the Reserve Bank of Australia announced in the afternoon that it would not to cut the cash rate for another month.

    It was buying 67.24 US cents at 1700 AEST, from 67.31 US cents on Monday.

    One Australian dollar buys 71.41 Japanese yen, from 71.46 yen ; 61.45 euro cents, from 61.28 cents ; 56.10 British pence, from 55.32 pence and 106.87 NZ cents, from 106.74 cents.

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  • Australian dollar declines

    Australian dollar declines

    The Australian dollar has declined Friday, buying 67.75 US cents from 67.83 US cents on Thursday.

    Yesterday, better-than-expected jobs data has helped edge up the Aussie dollar as fears the global economy is headed for recession continue to weigh on the currency.

    The Australian dollar has struggled under the weight of worldwide economic anxiety even as domestic data showed jobs jumped past expectations in July and lessened the risk of a rate cut in the very near term.

    The figures helped the Aussie edge up to $US0.6780, from an early low of $US0.6747, but left it short of Wednesday’s $0.6809 high after a 0.7 per cent drop overnight.

    The New Zealand dollar was sidelined at $US0.6439 after easing 0.3 per cent overnight to as low as $US0.6422.

    Both currencies had been pressured by concerns the United states, and with it the rest of the world, was heading for recession as Treasury yields sank to record lows.

    The yield on 30-year bonds broke under 2.0 per cent for the first time on Thursday and briefly traded beneath the three-month bill rate, an inversion that has foretold recessions in the past.

    The Aussie won some respite when domestic data showed 41,100 new jobs were added in July, well above forecasts of 14,000, with full-time work up 34,500.

    That was enough to make investors pare the probability of a rate cut from the Reserve Bank in September to 18 per cent, from 38 per cent earlier.

    However, the data also showed unemployment held at 5.2 per cent in July as more people went looking for work, implying that wage growth and inflation would stay subdued.

    Futures imply an 84 per cent chance of a quarter-point rate cut to 0.75 per cent in October, with November seen better than 100 per cent.

    RBA deputy governor Guy Debelle also highlighted the risks from the trade war in a speech earlier on Thursday, warning it could trigger a self-fulfilling global downturn.

    That outlook, coupled with the global rush to safe havens, kept Australian bonds well bid.

    Yields on the 10-year note hit another historic low of 0.88 per cent, having dived a staggering 60 basis points in the past month.

    New Zealand’s 10-year bond yields dropped to a record trough of 1.033 per cent to be down 65bps from this time last month.

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  • Australian dollar rises

    Australian dollar rises

    The Australian dollar has risen Thursday, buying 67.59 US cents from 67.11 US cents on Wednesday.

    Yesterday, the local currency hit a 10-year low of 66.77 US cents after New Zealand’s central bank cut the country’s cash rate by a larger than expected 50 basis points.

    The Aussie was trading as high as 67.83 US cents on Wednesday morning but fell more than 1.5 percent after the Reserve Bank of New Zealand cut its official cash rate to 1.0 percent in an attempt to reheat the country’s cooling economy.

    The Aussie’s biggest one-day decline since April dropped it more than one cent to as low as 66.77 US cents as RBNZ governor Adrian Orr spoke to media and said further cuts were possible.

    At 1335 AEST, the Australian dollar was worth 66.90 US cents, just above what had been its lowest level since March 18, 2009.

    The RBNZ’s move came a day after the Reserve Bank of Australia held the local cash rate at 1.0 percent but said it was prepared to reassess after weighing the impact of 0.25 percentage point cuts in June and July.

  • Australian dollar rises slightly

    Australian dollar rises slightly

    The Australian dollar is only slightly changed Wednesday, buying 69.61 US cents from 69.60 US cents on Tuesday.

    Yesterday, the local currency was on track for a sixth straight session of gains against a US dollar weakened by expectations for an aggressive cut in interest rates by the Federal Reserve next month.

    The Australian dollar climbed to a two-week high of 69.72 US cents on Tuesday and was last quoted at 69.65.

    The New Zealand dollar also jumped to a two-week top of 66.46 US cents.

    The six-day rally comes as yields on US Treasuries inched lower with Fed futures fully pricing in a quarter-point easing and a real-chance of a 50 basis point cut at the next FOMC meeting in July.

    The strength in the antipodean currencies was limited to the US dollar, however, as Australian and New Zealand central banks themselves are on an easing path.

    Against the Japanese yen and the euro, the currencies were hovering near multi-month lows.

    The Reserve Bank of Australia (RBA) is widely expected to cut interest rates to a new record low of 1.00 per cent at its July 2 meeting after already lowering once in June.

    However, given more aggressive pricing for the Fed many analysts expect the Aussie may not fall much further despite easings at home, a concern that RBA Governor Philip Lowe highlighted on Monday.

    “But if everyone is easing, there is no exchange-rate channel,” Lowe told a public forum in Canberra.

    “We trade with one another, we don’t trade with Mars, so if everyone’s easing, the effect that we get from exchange-rate depreciation via the transmission mechanism isn’t there.”

  • NZ dollar Rises

    NZ dollar Rises

    The New Zealand dollar lifted Thursday, trading at 65.39 US cents at 0800 in Wellington from 65.26 at 1700. The trade-weighted index was at 71.88 from 71.91.

    The kiwi was at 51.66 British pence from 51.96, at 58.19 euro cents from 58.32, at 70.63 yen from 70.71, and at 4.5096 Chinese yuan from 4.5064

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  • Australian dollar strengthens again

    Australian dollar strengthens again

    The Australian dollar has risen Wednesday, buying 69.62 US cents from 69.55 US cents on Tuesday.

    The local currency was on the back foot yesterday as its US counterpart continued to benefit from the trade truce with Mexico, even as Washington kept up the war of words with China.

    The Aussie was pinned at 69.56 US cents on Tuesday, having lost 0.6 per cent on Monday in the wake of the trade truce with Mexico.

    It had reached as high as 70.25 US cents at one stage before retreating.

    President Donald Trump’s decision not to impose tariffs on Mexico was taken as lessening the risk of recession in the United States and lifted 10-year Treasury yields up to 2.15 per cent from a  two month low of 2.05 per cent.

    It also led investors to trim expectations for interest rates cuts from the Federal Reserve, though futures are still wagering heavily on a move in July.

    Trump did not sound so conciliatory toward China, however, threatening another round of tariffs if no progress was made on trade at a Group of 20 summit later this month.

    China is Australia’s single largest export market and investors use the Aussie as a liquid proxy for positions on its economic outlook.

    The Aussie has troubles of its own as a survey of Australian business showed activity faltered in May even as confidence got a rare boost.

    The Reserve Bank of Australia has already cut interest rates to a record low of 1.25 per cent and markets imply around an 86 per cent probability of a further reduction by August.

    “Today’s survey again suggests increased risk that the unemployment rate will not make the further gains the RBA expects and strongly argues the case for further near-term easing in monetary policy,” said Ivan Colhoun, NAB’s chief economist, markets.

    “A weak outcome for unemployment would likely cement a July cut,” he added, referring to the official jobs report for May which is due on Thursday.

    Median forecasts are that employment rose a solid 17,500 in May, nudging the jobless rate down a tick to 5.1 per cent – an outcome that would likely lessen the urgency for a rate cut as early as July.

    Australian government bond futures were lower on Tuesday as risk appetite globally got a boost from the US-Mexico trade news. The three-year bond contract fell 2.5 ticks to 98.920, while the 10-year contract slipped 3.0 ticks to 98.5100.

  • Australian dollar strengthens

    Australian dollar strengthens

    The Australian dollar has risen Friday, buying 68.88 US cents, from 69.13 US cents on Thursday. Australia’s unemployment rate rose in April to the highest in eight months while full-time jobs fell, ABS data showed on Thursday, cementing views the central bank may be forced to lower rates soon to stimulate the economy.

    Yesterday, the Australian dollar skidded 0.4 percent to 68.91 US cents, the weakest since early January when a currency “flash crash” briefly sent the Aussie to 67.43 US cents.

    Financial markets are implying an almost 60 percent chance the Reserve Bank of Australia will ease policy next month.

    The RBA is closely watching the employment report for clues on monetary policy, as it is counting on labor market strength for a long-awaited pick up in wage growth and inflation amid a continuing slide in property prices.

    Thursday’s figures showed 28,400 new jobs were created in April, surging past expectations for a rise of 14,000.

    But in an unwelcome sign, all of the increase was led by part-time work, with full-time declining 6,300.

    Jobs are being created at a brisk annual pace of 2.6 percent, much faster than the 1.6 percent rise in population but that is still not enough to meet with surging labor supply.

    The unemployment rate rose for a second straight month to 5.2 percent, when analysts had expected 5.1 percent, as the participation rate climbed to 65.8 percent indicating more people went looking for work.

    More worryingly, forward-looking indicators of labor demand are now pointing to emerging weakness.

    The National Australia Bank monthly employment index slipped last month, dragging down the Composite Employment Index to 51.4, the lowest reading since September 2016, from 53.4 in March.

    A job index by Westpac has also turned down, suggesting that employment growth should slow to about two percent in the July-September period.

    With the jobless rate inching up, lukewarm consumer prices and sputtering economic growth, the RBA will likely cut rates from a record low 1.50 percent.

  • Australian dollar slides Again

    Australian dollar slides Again

    The Australian dollar has fallen Tuesday, buying 69.45 US cents from 69.75 US cents on Monday.

    Yesterday, the local currency lost ground as the stalemate in Sino-US trade talks clouded the outlook for the Asian giant in its demand for resources.

    The Aussie dollar slipped 0.4 percent to 69.75 US cents on Monday and ever closer to the recent four-month trough at 69.60 US cents.

    China is a major buyer of commodities from Australia so any threat to its trade is considered a potential negative for the currency.

    Investors also use the Aussie as a liquid proxy for China plays, in this case shorting it as well as the yuan.

    Joseph Capurso, a senior currency strategist at CBA, noted that Washington was due to release a “Section 232” report into the national security implications of car imports this week, which could give President Donald Trump more ammunition in his trade disputes.

    “Global stock markets, and global growth-sensitive currencies such as AUD and NZD, may be hit by fears a ‘trade war’ will spread,” Capurso said.

    “Europe, Japan, Korea, and Mexico are major exporters of cars to the US.”

    The Aussie also faces domestic hurdles from data on wages and jobs due this week, where any sign of weakness would fuel wagers on a rate cut by the Reserve Bank of Australia.

    The central bank last week emphasized that further improvement was needed in the labor market to bring unemployment down and lift inflation.

    Wage figures for the first quarter are due on Wednesday and are forecast to show modest growth for the year.

    The jobs report on Thursday is expected to show 14,000 net new hires in April, with the unemployment rate ticking up to 5.1 percent.

    “Downside surprises will raise pricing for a rate cut as soon as June,” added Capurso.

    “The AUD can drop more than one US cent if the labor data disappoints.”

    The futures market implies around a 63 percent chance of a quarter-point cut in July and is almost fully priced for a move in August.

    Yields on three-year bonds are already well below the 1.5 percent cash rate at 1.26 percent, and only just above record lows.

    Three-year bond futures were up one tick at 98.750, while the 10-year contract rose one tick to 98.2700.