While the U.S. Dollar Index (DXY) has dropped sharply since the start of 2025, the USD/VND exchange rate has moved in the opposite direction—continuing to climb. This apparent contradiction reflects the complex interplay of capital flows, market sentiment, foreign currency supply and demand, and domestic economic conditions. A decoupling between DXY and USD/VND The DXY measures the dollar’s strength against a basket of six major currencies, with the euro making up the largest share (57.6%). Despite falling from 109.2 to 99.2 points between January and April 2025, the interbank USD/VND exchange rate rose from VND25,370 to VND26,050 per USD. On the informal market, it nearly touched VND26,520 per USD. Data shows a weak correlation between the two. From January 2020 to April 2025, the USD/VND rate and DXY were only 8% correlated; this rose slightly to 20% in early 2025. In short, exchange rate movements in Vietnam are driven more by domestic and regional factors than by global dollar trends. U.S. tariff policy adds pressure On April 9, 2025, the U.S. suspended reciprocal tariffs (excluding China) for 90 days to allow time for negotiations. The move has direct implications for Vietnam, whose 2024 trade surplus with the U.S. reached US$106 […]

While the U.S. Dollar Index (DXY) has dropped sharply since the start of 2025, the USD/VND exchange rate has moved in the opposite direction—continuing to climb. This apparent contradiction reflects the complex interplay of capital flows, market sentiment, foreign currency supply and demand, and domestic economic conditions. A decoupling between DXY and USD/VND The DXY measures the dollar’s strength against a basket of six major currencies, with the euro making up the largest share (57.6%). Despite falling from 109.2 to 99.2 points between January and April 2025, the interbank USD/VND exchange rate rose from VND25,370 to VND26,050 per USD. On the informal market, it nearly touched VND26,520 per USD. Data shows a weak correlation between the two. From January 2020 to April 2025, the USD/VND rate and DXY were only 8% correlated; this rose slightly to 20% in early 2025. In short, exchange rate movements in Vietnam are driven more by domestic and regional factors than by global dollar trends. U.S. tariff policy adds pressure On April 9, 2025, the U.S. suspended reciprocal tariffs (excluding China) for 90 days to allow time for negotiations. The move has direct implications for Vietnam, whose 2024 trade surplus with the U.S. reached US$106 […]