US monetary policy tightening still has a way to go and slower US growth will likely affect the rest of the world. Economists at HSBC expect the US dollar to enjoy further gains.

The peak has yet to come

“As US policy tightening slowly takes hold, it might represent a further downside risk to global growth dynamics. In our view, the greater the downside risks to global growth, the greater the upside risks to the broad USD. The opposite should also hold true.”

“Our USD framework has rested on two forces coming together causing it to strengthen, namely a hawkish Fed and slower global growth. These have underpinned and will continue to support our strong USD view for the months ahead.”