Bears in a Dollar Shop
Why we struggle to get onboard with the bearish consensus USD view.
The sharp USD drawdown just before Christmas eased into year-end, with the greenback having a steady start to 2026.
We already flagged up in December why we felt GBP/USD might top out in Q1, and disagree with some of the bearish views on the Street for 2026 about the US dollar more broadly.
The US government shutdown means the latest set of economic data releases can’t be used to validate a clear bearish thesis, and the monetary policy outlook post-spring (post-Powell) again can’t be validated until further down the line.
Those, along with other reasons, lead us to take the other side of the trade and be moderate USD bulls, at least for Q1.
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