The US dollar index (DXY) is on track to post one of its best annual results in decades in 2022. The economists of Credit Suisse they believe this unusual strength is justified.
The USD looks set to continue to have support heading into 2023
“With core inflation substantially higher than the US Fed’s inflation target, the Fed began the fastest tightening in decades. This created a significant source of support for the USD through increased carry attractiveness. In addition, the safe-haven characteristics of the dollar proved attractive at a time of deteriorating global risk sentiment, both of which are likely to hold in 2023, and we expect the USD to remain vastly overvalued throughout 2023.”
“A turning point in the USD could come later in 2023. A dovish Fed pivot coupled with an improving global economic outlook would be necessary for the USD to return its gains.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
