After a sharp increase in April, the exchange rate between the U.S. dollar and the Vietnamese dong has been declining since early May across both formal and informal markets. What factors are driving these recent exchange rate trends? The exchange rate swings back around The value of the U.S. dollar in the informal market dropped by VND130 on May 15 and 16, bringing its buying and selling prices down to VND26,320 and VND26,420 per dollar, respectively. Similarly, bank transaction prices saw a slight decline of VND30-40 over the same week, settling at VND25,750 for buying and VND26,110 for selling. The central exchange rate between the dollar and the dong also experienced a modest VND13 reduction. The decline in the U.S. dollar followed a series of unexpected tariff announcements by President Donald Trump in early April. In response, the U.S. Dollar Index plunged from above 104 points to 98 points, before recovering slightly to 100 points at present. Conversely, the price of the U.S. dollar in Vietnam’s domestic market surged during the same period. In April, the central exchange rate increased by VND119, while transaction prices at banks jumped by VND440, and in the informal market, they skyrocketed by approximately VND600. […]
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