Citibank Buries the Dollar: Forecast Until the End of the Year

BRICS Promotes De-Dollarizationand Citibank predicts weakening of the US dollar amid a global slowdown in the coming months.

The US dollar is on a slippery slope as BRICS seeks to displace it as the world's reserve currency. The de-dollarization program is gaining momentum as the alliance urges developing countries to sever ties with the US dollar. Amid BRICS' de-dollarization efforts, Citibank has forecast the future of the US dollar and provided analysis of how the major currency could perform in the coming months.

Citibank predicts that the US dollar could weaken amid the global slowdown and remain in bearish territory for the next two months. The DXY index, which tracks the US dollar, shows the currency at 101.40. This is a sharp drop since the dollar was at 106.20 in June this year. The decline comes as BRICS moves to marginalize the US dollar. Citibank predicts that BRICS currencies could marginally outperform the US dollar in the next two months.

Citibank analysts also suggest that strong foreign currencies such as the euro and the pound could decline along with the US dollar. The bank remains cautious on the euro, noting that its growth could slow amid the currency economic crisis. This puts the US dollar and euro in the spotlight, allowing the BRICS currencies to advance.

Citibank's short-term outlook for the US dollar remains bearish amid BRICS de-dollarization, but it is bullish in the long term. “We think the dollar could ultimately strengthen a little later this year, given our economists' forecasts of a US recession and a possible change in ECB policy.”they wrote.

Author's opinion: As strange as it may sound, all these forecasts exist solely for the sake of forecasting. At the beginning of the year, we see one picture, closer to summer – a completely different one, and by the end of the year – something completely different. The reason is simple: it is part of the job to create public forecasts. If such information really had high value, it would never be widely discussed. After all, why would anyone share free information that could be used to make money?

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