US dollar momentum | Rothschild & Co
As the US dollar’s upward momentum continues, we examine the ‘dollar smile’ theory, which explains when to expect strong performance from the greenback.
US dollar momentum The greenback has remained strong this year. The DXY index, a gauge of US dollar strength vis-à-vis a basket of six major currencies, has risen by 4% in 2024. The euro has by far the largest weighting within the cohort, at close to 60% of the total. But the US dollar has still appreciated against the remaining currencies on a bilateral basis, including the pound (+2%), Canadian dollar (+4%), Swiss franc (+8%), Swedish krona (+8%), and most strikingly, the Japanese yen (+10%). Moreover, most emerging market currencies have also weakened against the dollar this year. Th
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