One euro traded for 1.168 USD. The British pound rose 0.2%, reaching 1.369 USD. Meanwhile, one USD was equivalent to 144.8 Japanese yen.
Against the Swiss franc, a renowned safe-haven currency, the greenback even hit a 14-year low, with one franc trading for 0.8 USD.
The dollar's decline stems from investor concerns about the potential impact on the Federal Reserve's (Fed) independence. The Wall Street Journal reported on 25/6 that President Donald Trump is considering announcing his nominee for the next Fed chair in September or October. Current Chair Jerome Powell's term ends in 5/2026.
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The Dollar Index has been declining this year and is now at a three-year low. Chart: Market Watch |
"Markets will likely react strongly to an early nomination of Powell's successor, especially if the decision appears politically motivated," said Kieran Williams, head of foreign exchange trading for Asia at InTouch Capital Markets.
He explained that this move raises doubts about the Fed's operational independence and could weaken the institution's credibility. "If this is the case, the market may adjust interest rate expectations and reassess the dollar," he warned.
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US President Donald Trump and Fed Chair Jerome Powell in 2017. Photo: Reuters |
On 25/6, when asked by reporters if he was interviewing candidates to replace Powell, President Trump replied, "I will choose from a group of three to four people."
According to media reports, the leading contenders include Fed Governor Kevin Warsh, White House Economic Adviser Kevin Hassett, Federal Reserve Board Member Christopher Waller, and Treasury Secretary Scott Bessent.
Over the past few months, President Trump has repeatedly urged the Fed to cut interest rates. On Truth Social on 23/6, he called for a further "two to three percentage point" reduction, claiming the US has "no inflation." Two days later, he criticized Powell as "terrible" for not cutting rates quickly enough. In recent posts, Trump has frequently called Fed Chair Jerome Powell "foolish, stubborn, and slow."
During a congressional hearing this week, Powell explained that the labor market remains strong and the impact of import tariffs is still unclear. Therefore, the Fed is not rushing to lower interest rates.
The USD has been declining for several months amid wavering investor confidence in the US economy. Both its status as a reserve currency and a safe haven are being challenged. The Dollar Index, which measures the dollar's strength against a basket of major currencies, is currently at 97.3 points, its lowest in over three years.
The euro is considered the biggest beneficiary of this development. Investors expect that substantial European Union (EU) investments in defense and infrastructure will boost the region's overall economic growth.
In the domestic market, Vietcombank is currently buying and selling USD at 25,900 - 26,290 VND. This represents a decrease of 57 VND in the buying price and 17 VND in the selling price compared to yesterday.
Ha Thu (Reuters)
