USD exchange rate cools down, more expectations of Fed rate cut

The State Bank of Vietnam announced the central exchange rate on August 7 at 25,239 VND/USD, up 7 VND/USD compared to yesterday, marking the second consecutive increase. However, the exchange rate listed at commercial banks has cooled down after soaring in the previous session.

At Vietcombank , the exchange rate returned to 26,040 VND/USD (buy) and 26,400 VND/USD (sell), down 20 VND/USD each way compared to yesterday. The USD selling rate at banks has fluctuated around the new level of 26,400 VND/USD for many days now.

The exchange rate movements at domestic banks are quite similar to the fluctuations of the international USD. The DXY index fluctuates below the 98.5 point threshold, maintaining its downward momentum after a sharp drop in the previous session. Investors are increasingly betting on the possibility that the US Federal Reserve (Fed) will cut interest rates as early as September, after a series of weak economic data and signs of a cooling labor market.

Along with that is the expectation that another cut could be made in December. The Fed Watch tool shows that investors expect the operating interest rate to be reduced by 25 basis points at the meeting on September 18 at a rate of 90.4%; while it has not reached the oversold level last week.

Betting odds on the Fed cutting interest rates at its September 2025 meeting continue to rise. Source: Investing.

Investors are also closely watching the Fed's personnel moves. Speaking to reporters at the White House, President Trump said he is considering appointing White House economic adviser Kevin Hassett and former Fed Governor Kevin Warsh to the vacant positions on the US Central Bank's Board of Governors.

Earlier, Mr. Trump said he would make a decision before the end of this week on appointing a replacement for Fed Governor Adriana Kugler, who unexpectedly announced her resignation last weekend. The official who replaces Ms. Kugler will continue her term until January 2026, and Mr. Powell's replacement will take over the position in May 2026.

Investors have concerns about the Fed's independence in a context where policy is dominated by political factors. Previously, data from the Bureau of Labor Statistics (BLS) of the US Department of Labor showed that the number of jobs in the US non-agricultural sector increased by only 73,000 jobs in July, much lower than market expectations.

The bureau also sharply revised down the previous month's new jobs figure, bringing the total number of new jobs for May and June to just 33,000, down 258,000 from the first published figure.

Notably, following the dismal report, President Trump fired commissioner Erika McEntarfer on charges of manipulating jobs data.

The Fed kept its policy rate unchanged after its December 2024 meeting.

Tensions also rose when President Donald Trump announced a 100% tariff on imported chips, except for those manufactured in the US. At the same time, he doubled tariffs on Indian goods to 50% in response to the country's continued oil purchases from Russia.

The notable fluctuations surrounding the story of monetary policy and tariffs in the US have caused gold prices to skyrocket. After climbing to the 3,380 USD/ounce area, world gold is still standing firmly around this price range.

In the domestic market, gold prices remained stable. SJC gold bars at Saigon Jewelry Company listed the buying price at 121.2 million VND/tael and the selling price at 123.8 million VND/tael.

Source: https://baodautu.vn/ty-gia-usd-ha-nhiet-them-ky-vong-fed-giam-lai-suat-d352660.html