2018 US Dollar Forecast

Forecasts for the US dollar vary from bank to bank and from month to month. This article takes a look at the general trend in US dollar forecasts and how it might impact your home currency

Bank forecasts for the US Dollar in 2018

The US dollar (USD) is bouncing back up from a recent plunge to 3-year lows. While most bank forecasts show the USD will continue to recover, the movements and speed differs widely. This is because there are a lot of influences (see “What are the key influences on the USD”).

 

Updated in October 2018

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How does the US dollar affect me?

The US economy is the biggest economy in the world. This is why events in the US significantly influences all other currencies.

Usually, when the USD goes up, your home currency gets weaker. When the USD falls, your home currency gets stronger. However, this isn’t always the case.

If you want to see what will happen to your home currency next year check out our currency posts for 2018 outlooks.

What are the key influences on the US dollar?

1. US Economy

When the US economy gets stronger the US dollar improves. Right now the US economy is growing, which means consumer spending, employment rates and house prices are all improving.

 

2. Politics

US politics currently has a big influence on the US dollar. Many believe President Donald Trump will be unable to deliver on his pre-election tax promises. Greater uncertainty from politics means investors will sell the US dollar, because there is a greater chance of it getting weaker.

 

3. Imports and Exports

The US is world’s largest importer and is the world’s second largest exporter (second to China). When imports are greater than exports the US dollar rises, because it signals a more prosperous economy.

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General advice: The information on this site is of a general nature only. It does not take your specific needs or circumstances into consideration. You should look at your own personal situation and requirements before making any financial decisions.