Dollar weakness more cyclical than structural
The U.S. dollar has lost part of its safe-haven value since 2024 but global demand for the currency remains broadly stable.
The dollar index fell nearly 10% in 2025, its worst annual performance since 2017, weighed down by erratic U.S. trade policy, tariff threats, and criticism of the Federal Reserve, News.Az reports, citing Reuters.
The dollar’s safe-haven value has declined versus 2024, measured against U.S. stocks and 10-year Treasuries.
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Private investors remain invested, holding over 80% of foreign U.S. assets. Current dollar weakness is seen as cyclical, not structural. No signs of accelerated de-dollarization in global markets.
ING warns that U.S. Fed independence is crucial; inappropriate rate cuts could trigger a run on the dollar.
The euro is expected to end 2026 at $1.22, compared with current levels around $1.18.
By Aysel Mammadzada
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