Analysis: The dollar index is expected to fall to 95 by the end of 2026.

Luca Paolini, strategist at Pictet Asset Management in Switzerland, said the dollar could weaken again next year as the US economy slows and the conditions are ripe for further interest rate cuts by the Federal Reserve. He pointed out that the spread advantage of the dollar is narrowing significantly. "We expect the US economy to weaken slightly, which will promote the gradual easing of inflationary pressures." In contrast, economic growth in other parts of the world is expected to pick up, with recovery in Europe and Japan likely to be particularly pronounced. In addition, the current valuation of the US dollar remains high, which also constitutes a significant bearish factor at the valuation level. Pictet Asset Management expects the US dollar index (DXY) to fall from the current 99.555 points to 95 points by the end of 2026.