The Dollar's Round Trip

The U.S. dollar index (DXY) shed nearly 10% of its value against major peers in 2025 — its worst annual performance since 2017.

The depreciation came in sharp, disorienting bursts:

  • A steep selloff in April 2025 following the chaotic rollout of reciprocal tariffs.
  • A second leg down in January 2026 during the World Economic Forum in Davos as U.S. escalation rhetoric over Greenland rattled institutional confidence.

That decline did not continue.

The dollar bottomed near 95.5 on the DXY in late January 2026 and has since rallied roughly 5-6%, touching a 13-month high of approximately 101.8 in late June 2026 and holding near 101 as of late July 2026.

Analysts attribute the reversal to resilient U.S. growth data, a repricing of Fed expectations from rate cuts toward a possible hike, hotter-than-expected inflation prints, and continued global appetite for U.S. Treasuries as the deepest and most liquid safe-haven market on earth.

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Any operator considering dollar-denominated debt financing for operations in Africa or the Caribbean should model the repayment obligation under both dollar-strengthening and dollar-weakening scenarios — 2025-2026 just demonstrated both can happen within a single 12-month window.

EUR/USD, which many banks had forecast reaching $1.20 by year-end 2026, has instead pulled back to roughly $1.14–1.15.

לאפריקה יש צורך במימון תשתיות של 155 מיליארד דולר בשנה. יש לה גם פרמיית תשואה של 20%.

לאפריקה יש צורך במימון תשתיות של 155 מיליארד דולר בשנה. יש לה גם פרמיית תשואה של 20%.

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