Dollar Dips Against Dong in Thriving Black Market Exchange
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The U.S. dollar took a hit against the Vietnamese dong in the black market this past Saturday morning, as unofficial exchange points reported a decrease of 0.34%, bringing the dollar’s value to VND 26,340. In contrast, Vietcombank opted to maintain its exchange rate at VND 26,130.
Globally, the dollar faced a significant decline on Friday, largely fueled by a surge of investor concern as U.S. President Donald Trump escalated trade tensions. His suggestion to impose a 50% tariff on European Union imports beginning June 1 sent investors scrambling, as reported by Reuters. The dollar index, a gauge that measures the greenback against a basket of other currencies, fell by 0.8% to settle at 99.09, marking its lowest point in three weeks.
Over the course of the week, the dollar slid 1.9%, on track for its most significant weekly percentage drop since early April. Jayati Bharadwaj, a global foreign exchange strategist at TD Securities, noted that the concurrent decline of the dollar and U.S. stocks indicates a noteworthy shift in market dynamics. “The dollar’s correlation with equities is broken,” she stated, adding that this inversion is likely to persist due to the U.S.-specific risks influencing the financial landscape since the year’s beginning.
In this topsy-turvy market, one might wonder if the dollar’s next move will involve a dramatic dance with tariffs or a quieter retreat into the shadows.
Questions & Answers
Q.What was the dollar’s exchange rate against the dong on the black market?
What was the dollar’s exchange rate against the dong on the black market?
The U.S. dollar traded at VND 26,340 on the black market, down 0.34%.
Q.How did the dollar perform globally last Friday?
How did the dollar perform globally last Friday?
The dollar fell by 0.8% in value, hitting its lowest point in three weeks, predominantly due to escalating trade tensions.
Q.What did the global FX strategist say about the dollar’s performance?
What did the global FX strategist say about the dollar’s performance?
Jayati Bharadwaj pointed out that the dollar is no longer acting as a safe haven, as its correlation with stock performance has significantly shifted.