Financial Experts Have A Grim Prediction For The US Dollar In 2026

The speculative noise surrounding what is coming in 2026 is filled with both highly positive and negative outlooks — with uncertainty at the core. Much of this centers on the market, with some thinking the AI bubble could spell bad news, while the reality of tariffs inflating prices nationwide is leaving American consumers paying the price for costly trade wars. Further adding to the uncertainty is the possibility of the continued devaluation of American currency, since much of the power of the American market, and its presence in the global market cap, is tied to the strength of the dollar.

Experts are particularly wary about the future of the U.S. dollar as both the domestic industry outlook, and the Federal Reserve's probable interest rate decisions, both indicate a bumpy 2026. Morgan Stanley noted in a late November 2025 report that the dollar could drop well below 100 on its U.S. dollar index by Q2 2026. Meanwhile, in a November interview with Bloomberg, Economist Mark Cudmore explained that "the US saw a declining share in its share of global market cap and that will resume further in 2026, and the dollar is a key part of that." Cudmore also noted that repatriation by U.S. companies (when a company brings its foreign profits back to the U.S.) – something that is currently seen as propping up the dollar's value — could decline in 2026, further hurting the dollar's strength.

Another factor contributing to expert predictions of a decline in the U.S. dollar include the growing White House pressure on the Fed to cut interest rates – especially since cutting rates has been a significant part of President Trump's economic plan. That said, the future of the Fed, and it's policies, is currently quite rocky, with the legality of Trump's attempts to fire certain executive branch positions, like Fed governor Lisa Cook, currently under review by the Supreme Court. Ultimately, much of the future of U.S. currency could lie with the decisions of both the Supreme Court and, by extension, the Fed in 2026.

With the future of the dollar remaining in question, investors might consider certain ways to help hedge against devaluation. One strategy could be to invest in hard assets, including unexpected ones that you may already have, like wine and gold, as their value tends to stays solid even with a drift in the dollar. Additionally, it could be worth investing in foreign markets and even diversifying your stock holdings to hedge against a shaky dollar.