The U.S. greenback has seen a stellar run so far this year, with Invesco DB US Dollar Index Bullish Fund (ARCA:UUP) logging a 2.8% return. However, things may go downhill in the coming days, with the Fed expected to cut rates in September.
Market Forecast: Dollar Weakening Against Yen
Geoffrey Yu, senior EMEA market strategist at BNY, shared his outlook on the U.S. dollar's performance against major currencies, telling CNBC that the dollar may continue to weaken against the Japanese yen through the end of the year. This is especially true given that the Bank of Japan is on a policy tightening mode, which could strengthen the yen against the greenback.
On Wednesday, the dollar was trading 0.6% higher at 146.09 yen around 11:50 AM London time. This followed a dip below the significant 145-yen level for the first time since Jan. 6, indicating a recent surge in the yen and a continued unwinding of the yen-funded carry trade, the CNBC article noted.
Carry Trade Explained
Carry trades involve borrowing in a currency with low interest rates and investing in ...
