The Dollar Is at Multi-Decade Highs. What Does That MeanAnd What’s Next? [Video]

The dollar has soared to its highest level in decades in recent months and is expected to remain strong well into this year.

The value of the dollar surged in the final three months of the year, as Wall Street tempered its expectations for interest-rate cuts following a slew of strong economic reports. Bank of America (BofA) Securities analysts estimate the dollar’s inflation-adjusted exchange rate, or real effective exchange rate, climbed to a 55-year high at the end of 2024.

Here’s what some analysts expect for the dollar in 2025—and what it could mean for your money.

Analysts expect the dollar to maintain its strength in the first half of 2025 as the U.S. economy continues to outpace its peers and many economists’ expectations.

“Barring any unforeseen and abrupt turn in the US data, it is difficult to see a near-term catalyst that would materially push the USD lower,” wrote BofA analysts in their 2025 USD forecast. …