US Dollar Strengthens Ahead of Election

The US Dollar (USD) continues to gain strength against major currencies, primarily driven by rising Treasury yields and market expectations surrounding the upcoming U.S. elections. Analysts note that a potential victory for Donald Trump could lead to higher tariffs and tax cuts, which may boost inflation and growth, thus supporting the dollar. The International Monetary Fund has raised its GDP growth forecasts for the U.S., highlighting the exceptional performance of the U.S. economy compared to other G7 nations. However, concerns remain regarding the implications of Trump's policies on fiscal sustainability and potential de-dollarization in the long term. Despite the USD's recent gains, some experts caution that it may be reaching its peak, suggesting that significant further increases will require new catalysts. Meanwhile, central bank discussions and upcoming economic data releases are expected to influence market sentiments further.