TD Securities Forecasts Weaker Dollar Despite Stable Fed Rates

TD Securities strategists have indicated that the U.S. dollar may weaken this year, even if the Federal Reserve does not cut interest rates in the future. According to Jin10, the strategists noted that amid the ongoing standoff between the United States and Iran and high oil prices, TD Securities no longer expects the Federal Reserve to cut rates in 2026, instead anticipating that rates will remain stable. However, they emphasized, 'We still maintain our forecast for a downward path for the dollar in 2026.' They believe that even if the Federal Reserve shifts to raising rates, the increase might be less than that of other major central banks. Additionally, they expect the U.S. dollar index to continue falling below the 98 mark once the Strait of Hormuz reopens.