Societe Generale Predicts: September Fed Rate Cut Will Have Limited Impact on the US Dollar
Publication Time:2024-07-23 23:22:07
Recently, Societe Generale's foreign exchange strategists expressed their view that although the Federal Reserve plans to start a rate-cut cycle in September, it will not lead to a significant depreciation of the US dollar. They emphasized that considering the rebound trend of the US dollar from 2021 to 2022, there is some downward adjustment space for the dollar. However, unless the US economy experiences an unexpectedly severe slowdown, interest rates in the US are unlikely to return to pre-COVID-19 levels. In addition, Societe Generale particularly pointed out that the USD/JPY currency pair may be most affected, with the exchange rate expected to fall from the current 156.197 to 140 by early 2025. Due to the sensitivity of the Japanese yen to changes in US interest rates and yields, the yen is hit particularly hard. Looking ahead, the EUR/USD exchange rate may also undergo adjustments, with predictions suggesting the exchange rate could rise from the current 1.0850 to 1.15 between 2024 and 2025.
US interest rates
Economic Slowdown
Fed Rate Cut
Exchange Rate Fluctuations
US Dollar Depreciation