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Why is the US dollar so strong again?

Despite expectations of a decline in the dollar this year, it has risen by 2% over the past month, which raises doubts among some experts, Reuters reports.

Usually, during a period of lower inflation and a potential reduction in interest rates by the Federal Reserve, the dollar is considered a safe haven and is expected to decline. However, why isn't this happening?

Analysts believe that there are several factors influencing the situation: firstly, concerns about negotiations on the US national debt ceiling, the state of the banking system and the outlook for the global economy strengthen the dollar as a safe haven.

The dollar index has risen about 2% since mid-April to around 103, but is still below its peak in September last year of 114.78. Possible problems with the national debt ceiling only strengthen the dollar. As long as there is a threat of a potential US default and some banks are in a weak position, investors prefer less risky assets such as bonds, gold and the dollar.

The vulnerability of regional banks and the uncertainty about resolving the problem with the US government debt ceiling only increase anxiety and strengthen the dollar.


Forex Award | World Forex Award | Forex
Forex Award | World Forex Award | Forex
Forex Award | World Forex Award | Forex
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