FXStreet reports that economists at HSBC still expect the USD to decline this year, albeit modestly. 

“If the global recovery is assured, cyclical currencies outperform in a cyclical upswing and can tolerate higher US Treasury yields. A lot of this may have played out but the process is not yet complete, in our view, and we see modest USD weakness this year. The median of the FOMC economic projections pointed to a stronger US economy with higher inflation, but no rate hikes through the end of 2023. Nevertheless, markets still expect the Federal Reserve to start raising the policy rate, possibly at the end of 2022.”

“All in all, we believe the new-found fondness for the USD so far in 2021 after a troubled 2020 appears to be premature.”