Four reasons why USD's current carry advantage is set to transition into a headwind – BofA
Source Fxstreet
Economists at the Bank of America analyze the potential shift from the US Dollar's (USD) carry advantage to a significant headwind.
Challenging period ahead for the USD
The Fed is predicted to be one of the initial G10 central banks to reduce rates, challenging the USD's carry advantage.
Given the higher starting point of US rates, their potential reduction could significantly narrow the rate differentials with other currencies, diminishing the USD's attractiveness.
The USD stands as one of the most overvalued currencies in the G10, a factor that could amplify its vulnerability in a rate-cutting environment.
Lower interest rates in the US typically boost global risk appetite, a dynamic that historically benefits currencies other than the USD.
Disclaimer: For information purposes only. Past performance is not indicative of future results.
Recommended Articles
After a turbulent 2025, what lies ahead for commodities, forex, and cryptocurrency markets in 2026?
Solana Future: From high-speed experiment to corporate treasury playbook for the next SOL cycleSolana’s Proof of History architecture is colliding with rising institutional treasury adoption and governance scrutiny, with SOL’s next cycle hinging on validator distribution, stability, and regulated capital access.
Solana’s Proof of History architecture is colliding with rising institutional treasury adoption and governance scrutiny, with SOL’s next cycle hinging on validator distribution, stability, and regulated capital access.
Silver price corrects almost 6% to near $86.50 during the Asian trading session on Thursday.
Standard Chartered lifts Ethereum call to $7,500, arguing institutional demand could leave Bitcoin trailingStandard Chartered raised its year-end Ethereum target to $7,500 (from $4,000), citing institutional demand, while projecting $25,000 by 2028 and scenarios toward $40,000 by 2030 amid ETF- and treasury-driven accumulation.
Standard Chartered raised its year-end Ethereum target to $7,500 (from $4,000), citing institutional demand, while projecting $25,000 by 2028 and scenarios toward $40,000 by 2030 amid ETF- and treasury-driven accumulation.
Bitcoin nears two-month highs with key indicators signaling potential for further gains as it targets $101,000.
Related Instrument
