"Strength to Persist Amid Challenges"

Despite the usual year-end softening, the strong dollar, supported by robust US macro performance and a hawkish Federal Reserve, is expected to persist. It has remained resilient even during Treasury sell-offs and rising long-term rates. Factors like high US rates and increasing US yields could further support the dollar.

Possible weakening factors include softer US macro data, a US economic slowdown, or a Eurozone recession. However, these potential weaknesses are not likely to result from shifts in Chinese or European growth prospects. High US rates may disrupt the financial sector, initially boosting the dollar due to tighter dollar funding conditions.