OCBC forecasts a 2–3% USD rise by end-2026, driven by inflation data and Fed policy cues against low-yielding currencies.
The US Dollar is poised for modest appreciation of 2–3% by the end of 2026, supported by upcoming US Consumer Price Index data and Federal Reserve communications. Strategists highlight the EUR and CHF as vulnerable to further USD strength due to their low-yielding profiles.
Recent momentum in the USD stalled after softer-than-expected June payrolls, but Tuesday’s CPI report and Fed Chair testimony could reignite its gradual uptrend. A sharper move above 5% remains a tail risk, contingent on oil prices exceeding USD100 per barrel.
The Japanese Yen may find near-term support from policy efforts to boost domestic investment, though broader USD strength is expected to persist amid Fed emphasis on inflation risks.