Reuters poll shows most FX analysts still expect dollar decline despite near-term gains from Fed rate hike expectations.
The U.S. dollar has rebounded nearly 4% from May lows, supported by elevated Treasury yields, resilient economic data, and expectations of Federal Reserve rate hikes. Commodity Futures Trading Commission data revealed long-dollar bets reached their highest level since January 2025, while interest rate futures price in nearly two hikes by year-end.
Despite this, a Reuters poll of FX strategists maintains a bearish dollar outlook, forecasting the euro to rise to $1.16 by end-September, $1.17 by year-end, and $1.18 in a year. Analysts cite cooling oil prices and potential Fed rate cuts in 2027 as factors weighing on the dollar.
The divide among strategists highlights uncertainty, with a growing minority predicting sustained dollar strength or smaller declines. Market reactions remain mixed as traders balance Fed policy expectations against broader economic trends.