Economists of the bank giant Wells Fargo think that the US dollar is weaker for the rest of the year, but they do not have the same prospects for 2026.
In a new analysis, they predict that the Greenback will weaken against most G10 and emerging market currencies until the end of 2025.
This is mainly due to their expectation that the American Federal Reserve will lower the federal fund rate with 75 basic points during the rest of the year, with predicted 25 -point cuts at the Federal Open Market Committee (FOMC) meetings in September, October and December.
The Wells Fargo economists predict the growth of the American GDP (gross domestic product) in the second half of the year, but they also believe that the American economy “will lose its outperformance pillar of support.”
“While trends in economic growth prefer international economies, we believe that a basis for supporting foreign currencies will arise and can strengthen foreign currencies in the coming months.”
However, they predict that those trends will reverse next year, giving the dollar strength in 2026.
“By next year, the Fed should have ended its relaxation cycle and will probably keep the rates on hold. The Carry appetite of the dollar should be attractive next year and reduce capital flows to the United States. Moreover, the tax stimulus of the” Big Beautiful Billing “should also support the upcoming. In the United States.
And although the rates are likely to be implemented next year, companies and financial markets can feel more comfortable to operate in a tariff environment by next year. In that sense, American companies can continue with investment decisions, while market participants can also feel at ease as investing as American policy security withdraws. “
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