The US dollar is yet to renew its course, heavily battered by macro US economic activity. The year 2025 was particularly depressing for the asset, as American currency experienced a spree of low price valuations due to Trump tariff policy. However, it seems that the US dollar is further in for a downturn in 2026 but with a twist.
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US Dollar To Break Further Down In 2026
The US dollar is in for a wild ride in 2026, as the asset is on track to experience further volatility in 2026. Experts are suggesting how massive macroeconomic developments coupled with Trump’s constant spending on One Big Beautiful Bill are set to deteriorate the dollar further. The strategists have shared how the dollar is forming a V-shaped formation, with the DXY index dropping as low as 94.
”The #DXY [1W] appears poised to continue its bearish trajectory after failing to break the December 2023 low for two consecutive weeks. The index is about to break the neckline of the big double top, targeting sub-95.”
Reverse Is Closer Than Before
However, in addition to this, experts later added how the US dollar may reverse course in mid-2026. Experts now believe that new government spending in the second half of 2026, with trade tariffs helping inflation, may ultimately help the American currency gain secure footing.
“2026 will be the year of the dollar. $DXY is pushing up against its 200dma, and I believe a Supreme Court ruling against tariffs could give it the boost it needs to break out and push higher to 100.”
Moreover, per a Reuters report, Jane Foley of Rabobank believes the dollar may continue to decline in “choppy ranges,” resisting a sharp fall.
“We’ve seen the Fed revise up its growth outlook for the US. And of course, we have many of the FOMC members thinking that the impact on inflation from tariffs could be temporary. And that to us suggests that with less disruption and with the market no longer positioned long of the US dollar, we might see the dollar holding its ground quite well. So we tend to favour wide, choppy ranges for, say, EURUSD into 2026 rather than a continued decline in the dollar’s value.”
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