A REUTERS survey found most FX strategists expect the dollar’s recent rebound to
fade over coming months as falling oil eases inflation and Fed-hike
expectations, though a sizable minority sees the dollar remaining strong. CFTC
data show the dollar has rallied about 4% from May lows as US/Israel–Iran
tensions eased and oil returned to pre-conflict levels; long-dollar positions
are the largest since Jan 2025. The currency is supported by inflation well
above target, a resilient US economy, elevated Treasury yields and June reports
that nearly half of Fed policymakers expected further hikes this year.
Interest-rate futures price in almost two hikes by year-end. In the June 26–July
1 survey, strategists largely rejected that market pricing and kept a
dollar-weak median view, projecting EUR/USD about 2% higher at 1.16 by
end-September, 1.17 at year-end and 1.18 in 12 months.
