HSBC: The US Dollar May Rise in the Short Term, But Gains Are Unlikely to Last

Jinse Finance reported that the market generally expects the Federal Reserve to announce an interest rate cut on Wednesday. Paul Mackel from HSBC stated that unless the Federal Reserve signals "the possibility of more rate cuts in the future," the US dollar may briefly rise after the rate cut statement is released. He pointed out that in order to further boost already high expectations for rate cuts, the Federal Reserve would need to meet extremely high conditions. According to data from the London Stock Exchange Group, the market currently expects the Federal Reserve to cut rates by a total of about 140 basis points by the end of 2026. Against this backdrop, there may be a short-term spike in the US dollar after Wednesday's statement is released. However, Mackel believes that considering the prospect of faster rate cuts in the future, especially if employment data continues to weaken, any gains in the US dollar may be temporary.