Economists at Wells Fargo forecast a softer greenback than previously and believe the US Dollar has already embarked upon a prolonged period of depreciation.

US Dollar's depreciation to gather pace in 2024

“Given more resilient growth internationally and a hawkish shift by some foreign central banks in recent months (notably the European Central Bank and Bank of Japan), we believe the USD has embarked upon a prolonged period of depreciation.”

“In the short term, we expect USD depreciation to be gradual as the US economy falls into recession, while the Fed hesitates to lower interest rates prematurely. 

“We expect the US Dollar's depreciation to gather pace in 2024 as we believe the Fed will start cutting interest rates quicker than foreign central banks.”