Experts are betting on the growth of the dollar against the euro, pound sterling, and the Swiss franc. Central banks in different parts of the world signaled that soon additional stimulus will come amid expectations of a slowdown in economic growth and inflation. In the US, the market is expected to cut rates, perhaps even in July, which increases interest in the Fed's comments following the FOMC meeting on Wednesday.
Even though the reduction in interest rates reduces the attractiveness of the currency, the dollar looks quite stable against most of the major competitors from the Big Ten. Investment subsidiary of the banking holding company Well Fargo hedges potential risks by buying dollars. At the same time, the American investment company Invesco predicts the growth of the US currency against the euro, pound sterling, and the Swiss franc.
Experts from both companies are confident that economic weakness in Europe and China will not undermine the fundamental picture in the United States. Even if the US economy slows down, there will be no more attractive alternatives elsewhere on the planet. Therefore? There are no special incentives to reduce the shape of assets in the dollar.
In general, the concept of a dollar strategy is this: if other developed countries also face a slowdown and their central banks are also forced to lower rates to maintain economic expansion, the dollar will not have to depreciate much, even if the Fed rates are reduced.