Thu Hà

The State Bank of Vietnam (SBV) must closely monitor the USD/VNĐ exchange rate in 2025, as trade tensions are already exerting pressure on the domestic forex market in the early months of the year, experts said.

US President Donald Trump announced that new 25 per cent tariffs on imports from Mexico and Canada took effect on March 4, along with a doubling of duties on Chinese goods to 20 per cent, marking the latest escalation in the global trade disputes.

China responded immediately after the new US tariffs, announcing additional tariffs of 10-15 per cent on certain US imports from March 10 and a series of new export restrictions for designated US entities.

Canada and Mexico, which have enjoyed a virtually tariff-free trading relationship with the US for three decades, are also poised to retaliate against their longtime ally soon if the US tariffs are still in place.

According to experts, these developments have heightened concerns about a broader trade war, extending beyond the US-China conflict of 2018-2020 to a global scale. The US is no longer solely targeting China but is also considering tariffs on allies. This indicates that the current economic tensions are not just about trade but also involve currency and finance on a larger scale than in previous periods.

Amid this context, the USD/VNĐ exchange rate has experienced significant fluctuations since the start of 2025. Currently, commercial banks list the US dollar at around VNĐ24,700 per dollar for selling and VNĐ25,300 for buying.

Compared to pre-Lunar New Year [February] levels, the selling price at banks has risen by about VNĐ400 per dollar, while the buying price has increased by approximately VNĐ600. Within just half a month, the USD/VNĐ exchange rate at banks has appreciated by 1.6-2.4 per cent.

Finance and banking expert Nguyễn Trí Hiếu said that the SBV needed to closely monitor the exchange rate as it could face further volatility in 2025 due to global economic factors, particularly from the US.

“Around 80 per cent of all foreign currency transactions in Việt Nam, including import-export payments, foreign investment flows, personal transfers, and interbank payments, use the US dollar. Therefore, any fluctuations in the global market affecting the dollar will impact domestic monetary policy, especially the exchange rate,” Hiếu told Việt Nam News.

According to Hiếu, the risk of an escalating trade war could influence exchange rates, currency values, and the balance of payments. The US is pursuing a protectionist approach for strategic industries while increasing economic pressure on trade partners to attract foreign direct investment (FDI) back to the US and reduce reliance on global supply chains. These policies have shifted investment flows, affecting exchange rates and the balance of payments in many countries, including Việt Nam.

Additionally, higher US tariffs on Chinese goods could drive inflation, prompting the US Federal Reserve to shift from a loose to a tight monetary policy to contain rising prices. This could directly impact global capital flows, as investors may prefer holding the dollar over investing in emerging markets.

“If the dollar strengthens in the global market, the USD/VNĐ exchange rate could come under greater pressure, increasing the cost of importing raw materials and raising the foreign currency debt obligations of enterprises,” Hiếu said.

He added that if Việt Nam maintains a loose monetary policy to support economic growth, the widening interest rate gap between the Vietnamese đồng and the dollar could lead to capital outflows, further straining the balance of payments.

Trần Thị Khánh Hiền, head of the Military Bank Securities Company's research division, also warned that trade-related risks would continue to strengthen the dollar.

Trump’s tariff policies reinforced the dollar’s dominance, making it crucial to stay alert to exchange rate risks, Hiền noted.

Flexible management

To address exchange rate pressures, Hiếu stressed the importance of ensuring financial stability, maintaining macroeconomic balance, and controlling inflation.

“The Government should manage the USD/VNĐ exchange rate flexibly, allowing it to fluctuate within a controlled range to accurately reflect market supply and demand. Moreover, the SBV should increase foreign exchange reserves to enable intervention in the forex market when necessary,” he said.

According to SBV Deputy Governor Đào Minh Tú 2025 presents numerous uncertainties that could impact the exchange rate and forex market. Therefore, the SBV will closely monitor developments to implement flexible exchange rate management aligned with actual conditions.

“In a volatile environment, a coordinated approach to monetary policy tools will be key for the SBV to stabilise the forex market and prevent strong fluctuations from affecting businesses and the economy,” Tú said.

To minimise the adverse effects of exchange rate volatility, Dr Đinh Trọng Thịnh, an economist, recommended that enterprises adopt risk-hedging strategies.

Additionally, businesses should implement measures to mitigate exchange rate risks, such as diversifying supply sources, working with banks that offer preferential trade finance policies, and establishing reserve funds for currency fluctuations, Thịnh said.  BIZHUB/VNS