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- Dollar's strength here to stay; only a rate cut could dent it – Reuters poll
Dollar's strength here to stay; only a rate cut could dent it – Reuters poll
“The dollar's renewed strength against most major currencies will not fade away anytime soon,” per FX strategists polled by Reuters. The survey of 74 market strategists polled June 1-7 also quotes the respondents as saying, “It would take rate cuts from the Federal Reserve to weaken the currency substantially.”
Key findings
Most major currencies were not expected to reclaim their end-April levels against the dollar at least until September.
That was a near-across-the-board upgrade compared with a May survey.
A majority of respondents who answered an additional question said a rate cut by the Fed, which economists do not expect to come until next year, or a pause in its tightening cycle could lead to a sustained weaker dollar.
But a majority of economists in a separate Reuters survey predicted the Fed would pause in June for the first time in more than a year and keep its key interest rate at 5.00%-5.25% then and for the rest of the year.
A growing minority, however, expected at least one more hike between the June and July meetings.
Mostly all major currencies were predicted to trade below their respective 2022 highs against the dollar - which were largely before the Fed began its tightening cycle - in one year from now.
Also read: US Dollar Index: DXY struggles to cheer Fed rate hike concerns, upbeat yields around 104.00
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