The US Dollar (DXY) Index climbed to a three-month high last week. However, economists at UBS do not expect the US Dollar (USD) rally to last.
While we expect the US currency to remain strong in the near term, we think it will weaken as Fed easing approaches-albeit at a slower pace than markets had been expecting in the first weeks of the year.
A renewed period of Dollar depreciation is especially likely given signals from other top central banks.