The dollar’s strength continues to ride on market expectations that the Federal Reserve will keep monetary policy tight amid robust US economic data. Yet some analysts contend that this outlook could shift as the US economy faces renewed pressure. Forbes notes the shifting mood in the market as data remains strong yet interpreted through a cautious lens.
Gazprombank President Yegor Susin argues that markets may be overstating the Fed’s willingness to hold rates high for longer due to positive American statistics. He notes that the latest data points suggest the Fed would likely keep interest rates elevated longer than many anticipate. In parallel, euro-area data shows signs of slower growth, which could prompt the European Central Bank to pause further rate rises despite persistent inflation. Germany and the Netherlands have already shown recessionary tendencies, and analysts expect the divergence in policy paths between the Fed and the ECB to continue supporting the US dollar.
Still, Susin warns the dollar’s ascent is not guaranteed to endure if rates stay high. US growth under the current framework may be limited, and any fresh negative economic news could quickly push the dollar index lower, signaling a potential peak in the currency’s strength.
Experts also note that the impact of a stronger dollar on the ruble is relatively constrained. For Russia, domestic market conditions and oil prices play a more decisive role. Analyst Alexander Potavin explains that the link between the dollar and oil has weakened as payments for energy are increasingly settled in local currencies, diminishing the traditional dollar-oil correlation. In the near term, the ruble could strengthen a bit further against the euro and yuan, but downside risk remains if US economic data deteriorate.
Recently, Digital Broker analyst Daniil Bolotskikh was cited as noting a potential rise of the dollar to the 100 ruble level. Earlier forecasts for the ruble’s exchange rate over the next several years have already shown more pessimistic scenarios, reflecting ongoing volatility in markets and currency relationships across major regions.