Vietnamese dong forecast to depreciate by 3% against US dollar in 2025

A strong US dollar will still be a major factor influencing the USD/VND exchange rate in 2025, causing the Vietnamese dong to depreciate by about three% against the dollar, experts forecast.

Under a 2025 outlook report released recently, experts from Vietcombank Securities Company (VCBS) predict the US dollar index (DXY) may remain at a high level and may last longer than expected.(Photo: VNA)
Under a 2025 outlook report released recently, experts from Vietcombank Securities Company (VCBS) predict the US dollar index (DXY) may remain at a high level and may last longer than expected.(Photo: VNA)

Hanoi (VNS/VNA) - A strong US dollar will still be a major factor influencing the USD/VND exchange rate in 2025, causing the Vietnamese dong to depreciate by about three% against the dollar, experts forecast.

Under a 2025 outlook report released recently, experts from Vietcombank Securities Company (VCBS) predicted the US dollar index (DXY) may remain at a high level and may last longer than expected. At the same time, the main trend of central banks around the world is to lower interest rates to stimulate economic growth.

In addition, the labour market and service sector of the US are still quite positive, so it is likely that the US Federal Reserve (Fed) will delay cutting interest rates longer than expected, that will also cause the dollar to be stronger for longer than that of other currencies.

Geopolitical conflicts will also lead to investment demand in safe-haven assets and the dollar may be the preferred asset.

Dr Vu Mai Chi, a lecturer of the Banking Academy, also noted Vietnam will face risks from exchange rate fluctuations and changes in trade strategies of major economies, especially the protectionist policies of the US under the leadership of new President Donald Trump. Protectionism under Trump’s administration could increase trade barriers and affect exports and FDI flows into Vietnam.

Sharing the same view, expert Dr Nguyen Tri Hieu predicted that in 2025, the USD/VND exchange rate could continue to be strongly affected by the economic policies of President Trump. Specifically, Trump's tax reduction policy for high-income earners is expected to increase the US budget deficit, which could lead to the US government having to issue bonds with high interest rates to stabilise the budget.

As a result, inflation could increase, forcing the Fed to adjust monetary policy from loosening to tightening and raising interest rates again. When interest rates in the US increase, the dollar will strengthen, causing the dong to depreciate against the dollar and the USD/VND exchange rate to increase.

The possibility of a sharp increase in the USD/VND exchange rate will significantly impact the monetary policy of the State Bank of Vietnam (SBV). If the exchange rate increases, inflationary pressure in Vietnam will also increase. In that situation, the SBV may need to change its monetary policy, including raising interest rates, along with other policies to reduce pressure and control inflation. The change may be a necessary step to stabilise the macro economy in the context of global fluctuations, Hieu said.

Under a recently released report, Standard Chartered Bank Vietnam forecast that the dollar will weaken in the first half of 2025, before recovering strongly by the end of the year. The bank warned that from the second quarter of 2025 onwards, Trump’s policies could put great pressure on the exchange rate, forcing the SBV to raise the policy interest rate.

By the end of 2024, the USD/VND exchange rate increased by 4.31% compared to the beginning of this year. However, the depreciation of the dong was less than that of the Republic of Korea’s won (12.51%); Philippines’s peso (4.74%); and Indonesia’s rupiah (4.85%)./.

VNA

See more

Workers at Garment 10 Corporation (Photo: VNA)

European businesses confident in Vietnam’s economic prospects: report

European business leaders are increasingly optimistic about the economic prospects of Vietnam whose position as a crucial link in Southeast Asia continues strengthening despite a turbulent global landscape, according to the Q4 2024 Business Confidence Index (BCI) report released by the European Chamber of Commerce in Vietnam (EuroCham Vietnam) on January 8.

Company representatives at the MoU signing ceremony. (Photo: VNA)

Vietnam SuperPort, strategic partners to strengthen regional connectivity

Vietnam SuperPort on January 7 signed a strategic Memorandum of Understanding (MoU) with the Transport Development and Strategy Institute under the Ministry of Transport of Vietnam, and China Railway 16th Bureau Group Vietnam Co. Ltd. (part of China Railway Construction Corporation) on cooperation to develop rail logistics infrastructure.

An office building in HCM City’s Tan Phu district. HCM City's office market is experiencing record absorption in 2024. (Photo: VNA)

HCM City office market sees highest absorption in a decade

Ho Chi Minh City’s office market has achieved rapid growth fuelled by steady demand and burgeoning supply, reinforcing the city’s status as a premier destination for both local and international corporations seeking strategic growth opportunities in Southeast Asia, according to real estate consulting firm Knight Frank.

Deputy Prime Minister Ho Duc Phoc speaks at the 17th Vietnam Economic Scenario Forum’s spring 2025 plenary session in Hanoi on January 7. (Photo: VNA)

Technological advancements key to growth transformations: official

Technological innovation, technology transfer, and workforce training form the core strategy for transforming the nature of Vietnam’s economic growth in the coming years, Deputy Prime Minister Ho Duc Phoc remarked at the 17th Vietnam Economic Scenario Forum’s spring 2025 plenary session in Hanoi on January 7.

At the launching ceremony of an online booth introducing products of the northern province of Thai Nguyen on Shopee platform on January 7. (Photo: Baothainguyen.vn)

Thai Nguyen’s provincial-level e-commerce booth makes debut

An online booth introducing products of the northern province of Thai Nguyen on Shopee platform was launched at an event on January 7, marking Thai Nguyen as the first locality in the country to offer its products for sale on an e-commerce platform.

Affordable goods with fine packaging for upcoming Lunar New Year (Photo: VNA)

Retail sales of goods and services up 9% in 2024: GSO

Vietnam's total retail sales of consumer goods and services reached 6.39 quadrillion VND (251.87 billion USD) in 2024, marking a year-on-year increase of 9%, according to the General Statistics Office (GSO).

Star Telecom (Unitel), a joint venture between Viettel Global and Lao Asia Telecom. Laos has been the largest recipient of Vietnamese investment over the past years. (Photo: baodautu.vn)

Vietnam invests 664.8 million USD abroad in 2024

Vietnamese investors pumped nearly 664.8 million USD into 164 new projects and 26 existing ventures abroad in 2024, up 57.7% in value as compared to the previous year, according to the Ministry of Planning and Investment’s Foreign Investment Agency.

A farmer tends to her pepper plants in the central highlands province of Dak Nong. (Photo: VNA)

Vietnamese pepper: decline in volume, surge in value

Despite a 5.1% drop in export volume, Vietnam’s pepper industry recorded a 45.4% increase in export turnover in 2024, reaching nearly 1.4 billion USD, according to the Vietnam Pepper and Spice Association (VPSA).

Twelve projects, including 10 domestic projects and two foreign-invested ones, are set to break ground in the Saigon Hi-tech Park (SHTP) in Ho Chi Minh City in 2025. (Photo: baodautu.vn)

Twelve projects to be developed in Saigon Hi-tech Park in 2025

Twelve projects, including 10 domestic projects and two foreign-invested ones with a total investment exceeding 1 billion, are set to break ground in the Saigon Hi-tech Park (SHTP) in Ho Chi Minh City in 2025, according to the park’s management board.

A LNG power facility in the central province of Nghe An (Photo: VNA)

LNG power projects face multiple hurdles

LNG power projects in Vietnam are currently grappling with many obstacles, ranging from bureaucratic delays to issues with power purchase agreements (PPAs), leading to significant project implementation slowdowns.

A large cargo ship docks at Cat Lai Port in Thu Duc city of Ho Chi Minh City. (Photo: VNA)

Vietnam to upgrade port infrastructure to accommodate larger cargo vessels

The Vietnam Maritime Administration (VMA), under the Ministry of Transport, is preparing a proposal to enhance the operational capacity of public maritime infrastructure and existing port facilities. This initiative aims to address the rising trend for large cargo vessels, which are increasingly calling at Vietnamese ports.

The eighth meeting of the Government's Steering Committee for reviewing the implementation of the 12th Party Central Committee’s Resolution No. 18-NQ/TW in Hanoi on January 6 (Photo: VNA)

PM urges optimal SOE reform for national interests

The restructuring of state-owned corporations and enterprises must follow the spirit of “placing national interests above all else” to ensure that state capital is managed and developed optimally, serving national development in the new era, said Prime Minister Pham Minh Chinh.