What FX experts advise for the coming year

Frankfurt After a long period of steady gains, the US dollar is at a crossroads. By early November, the US currency had staged a historic rally. At its peak, it cost more than a euro and the dollar index, which measures its value against a basket of other major currencies, rose to a 20-year high.

But then the flight ended abruptly. The question now is whether this is a short-term correction or a trend reversal. The dollar exchange rate has enormous importance for the worldwide financial system and capital flows. This applies in particular to emerging countries, where companies, households and governments traditionally borrow heavily in dollars.

In contrast to the dollar, the Japanese yen caused a stir in 2022 due to high losses. However, experts now see potential there, as well as with selected emerging market currencies.