Dollar Under Surveillance: Experts Warn of Risks in 2025

DataChief · 2026-01-12T10:15:53+00:00

The American dollar faces a complex crossroads, with weakening attributed to the Federal Reserve's rate-cutting policies. Potential risks include shifts in interest rate expectations and a sudden collapse of the AI bubble, which could further pressure the dollar.

DataChief

2026-01-12 10:15:53

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The outlook for the US dollar faces a complex crossroads. Following the Federal Reserve’s interest rate reduction policy, the currency has experienced a consistent weakening during this period. The DXY dollar index reflects this reality: it recently traded at 98.59, down 0.05%, while last September it hit lows not seen in three and a half years, reaching 96.218.

Warnings about risk scenarios

Benjamin Melman, CEO of Edmond de Rothschild, a leading asset manager, has highlighted two potential threats that could accelerate the depreciation of the US currency in the upcoming period. The first is related to a possible reversal of expectations regarding US interest rate behavior. The second, more structural, is associated with the possibility that the artificial intelligence bubble could burst abruptly.

“If the market shifts its concerns toward US interest rates, or if the AI tech bubble collapses suddenly, the dollar will face additional pressures,” said the executive of the European financial institution.

Context of prolonged weakening

The trajectory of the US dollar this year has been marked by a clearly unfavorable trend, directly linked to the monetary policy decisions of the US central bank. This environment of lower rates has diminished the dollar’s relative attractiveness in international markets, fueling its sustained decline.

Analysts continue to closely monitor any signals that could alter these dynamics, aware that both a change in the interest rate trajectory and a correction event in assets linked to artificial intelligence could be significant catalysts for the currency’s future movement.

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