Wells Fargo Bearish on US Dollar As Standard Chartered Says USD Decline Signals Concern on America’s Long-Term Fiscal Path
Two banking giants ring the alarm on the US dollar.
In a survey carried out by Reuters between April 30 and May 6, around 55% of exchange strategists who answered an additional question expressed Concern about the US dollar serving as a coverage in times of economic uncertainty.
Wells Fargo's macro-strarte, Erik Nelson sees the dollar depreciating in the coming months, predicting that the American economy will soon show signs of slowdown.
“We are more downgraded on the dollar in the second half.
At the same time, the chief of global research G10 FX of Standard Charterd, Steve Englander, says that he is “very concerned” by the dollar as an asset with a package. England highlights the deterioration assessment of the United States, noting that investors are prudent to have American assets while the government continues to print significant budgetary deficits.
“It's like a betrayal of a friend. You can say that it didn't matter, or that you didn't want it, but your friend still remembers. This is where the dollar is currently with regard to international trust.
If you asked me for this two months ago, I would say what matters to the dollar in the first place, it is the stimulus, and the financing – whether or not they have obtained income – would be secondary. Now it is clear that the markets are much more concerned with the long -term budgetary path. »»
Treasury Department data shows that the United States has spent 1.31 Billion of dollars more than it has collected this exercise so far, which takes place from October 1, 2024 to September 30, 2025. The figure represents an increase of $ 242 billion compared to the deficit recorded during the same period in the last financial year.
Meanwhile, the US dollar index (DXY), which appears at the USD against a basket of foreign currency, has been down more than 7% since February.
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