The VND Currency 2025
The Vietnamese dong (VND) has long been considered a stable yet tightly managed currency, especially in its relationship with the U.S. dollar. While the VND is not freely floating, it is allowed to move within a controlled band set by the State Bank of Vietnam (SBV).
Over the past decade, the VND has gradually depreciated due to inflation pressures, trade imbalances, and the dominance of the dollar in global trade. However, recent shifts in Vietnam’s economic strategy and global monetary trends have sparked new questions: when will the VND increase in value against the U.S. dollar?
At present, most analysts do not expect a dramatic revaluation of the VND in the short term, but there are signs of gradual strengthening potential in the medium to long term. Several factors support this view.
First, Vietnam continues to post strong economic growth, averaging 6–7% annually before the COVID-19 pandemic, and rebounding quickly in 2023 and 2024 due to resilient exports, foreign direct investment (FDI), and robust manufacturing.
Major companies from the U.S., South Korea, and Japan are shifting production to Vietnam, boosting foreign reserves and increasing demand for the VND in business transactions.
Second, the State Bank of Vietnam has managed its monetary policy cautiously. While inflation has been a concern, the SBV has generally kept rates in check and maintained a stable exchange rate policy.
This conservative approach has helped build trust in the VND among foreign investors and trading partners. Furthermore, Vietnam’s trade surplus with the United States has grown significantly, a trend that typically adds pressure for currency appreciation. However, because the VND remains under strict central bank control, it is unlikely to see large, sudden gains unless the SBV deliberately allows it.
That said, U.S. monetary policy also plays a big role in this equation. If the Federal Reserve cuts interest rates, which many economists expect in late 2025 or 2026, the U.S. dollar may weaken. This would automatically strengthen other currencies like the VND. Additionally, Vietnam’s push toward digital banking and modernization of its financial infrastructure is a significant factor that may improve capital inflows and strengthen the currency over time.
While a sharp rise in the VND against the U.S. dollar is not expected in the immediate future, there is cautious optimism for long-term appreciation.
The likely scenario is a slow and controlled strengthening of the dong, driven by strong economic fundamentals, increasing foreign investment, and potential changes in U.S. monetary policy.
Investors watching the Vietnamese market should focus on long-term trends rather than short-term speculation. In other words, hold on to your VND and your IQD.
