Strategists Warn Dollar May Slip Toward 95-100 as Fiscal Risks Undercut 1.15% 2026 Gain
Updated
Updated · CNBC · Aug 19
Strategists Warn Dollar May Slip Toward 95-100 as Fiscal Risks Undercut 1.15% 2026 Gain
3 articles · Updated · CNBC · Aug 19
Summary
The dollar faces rising downside risk even after a 1.15% year-to-date gain, with strategists saying recent strength is losing support as the Dollar Index sits at 99.4 after peaking at 101.80 in June.
30-year Treasury yields hitting their highest since 2007 have not reassured bulls, because higher yields tied to fiscal risk, heavier borrowing or inflation can weaken rather than bolster the currency.
Softer U.S. consumption, inflation and employment data have already prompted investors to trim long-dollar positions, and SocGen said the index could drift in an “uninspiring” 95-100 range for the rest of 2026.
Deutsche Bank also flagged Fed uncertainty as dollar-negative, saying mixed signals from Chair Kevin Warsh and any expanded use of the Fed’s FIMA facility could further pressure the greenback.
BBH offered a partial offset, arguing foreign demand for U.S. assets remains deep—stock purchases reached $920 billion in the year to June versus $294 billion for Treasuries—and an equity selloff could still push investors into dollar-supportive safe-haven bonds.