Will the US Dollar be able to maintain its dominance in the coming period?

By Samir El Khoury, ACSI, ACICMP?

It seems that the US dollar will continue to dominate in the coming period over most foreign currencies, for several reasons, including the following:

• First, the flexibility of the US economy and the outperformance of most economic data against market expectations, unlike the data from most advanced economies such as the Eurozone, the UK, and emerging markets.
• Second, the cautious and hawkish statements of Federal Reserve Chairman Jerome Powell, especially regarding inflation. He indicated that reaching the inflation target of 2% could take one or two years. Additionally, the Federal Reserve’s dot plot was published, which pointed to two interest rate cuts next year, after the September dot plot had forecasted four cuts. This reflects a slowdown in the pace of interest rate cuts, which has positively affected the US dollar and US Treasury yields across various maturities.

Read more: Will the US Dollar be able to maintain its dominance in the coming period? - Taurex

Please note that this analysis is provided for informational purposes only and should not be considered as investment advice. All trading involves risk.