18 July 2025 | Dollar

BofA warns of potential US dollar surge this summer

BofA warns of potential US dollar surge this summer

BofA remains skeptical about the US dollar's medium-term growth prospects. However, the bank sees a chance for temporary gains of the currency in summer.

The report highlights signals pointing to a potential trend reversal, including the absence of Federal Reserve rate cuts and reduced selling of dollar-denominated assets.

Still, BofA analysts expect political risks in the country to remain elevated. While traders have already priced in these risk premiums, some events such as leadership changes at the Fed or tariff escalation could disrupt markets.

The bank is closely watching the August 1st deadline for US import tariffs, especially if measures target the EU and China without international consensus.

Elena Berseneva MarketCheese
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