Following unusually strong price changes for currency markets in the first half of 2025, volatility decreased noticeably during the summer months. As a result of the resumption of the interest rate cut cycle in the US, the dollar temporarily came under extra pressure but recently stabilised again.

In this PERSPECTIVES Viewpoint FX: "Monetary policy back in the spotlight", we analyse the factors expected to influence exchange rates in the coming months. We also provide our 12-month outlook for the USD and some other currencies.

Key takeaways:

  • Following the Fed's resumption of its interest rate easing cycle, the USD fell to new annual lows. Although it has stabilised recently, the headwinds are likely to pick up again. The EUR should be supported by fiscal spending in Europe.
  • The BoJ is still proceeding very slowly with monetary normalisation, while Japanese domestic politics is marked by uncertainties. The JPY should appreciate in the medium term, though.
  • Despite China’s trade conflict with the US, the CNY recently rose to a 12-month high against the USD. Beijing remains interested in a strong CNY due to stable FDIs.

'

The PERSPECTIVES Viewpoint is currently available and client-ready for the following regions: Germany, Americas, Europe, Middle East, Africa and Asia Pacific.

PDF

Language:

Related special reports

Red Sea tanker

PERSPECTIVES Memo

Red Sea disruptions: increasing risks for energy markets

Houthi attacks in the Red Sea have increased risks to global oil supply and highlighted a key vulnerability in Saudi Arabia’s alternative export route. We explore the immediate market impact and implications for investors.

Jul. 24, 2026

podcast hero

PERSPECTIVES Weekly Podcast

July 20 – Watching for earnings from big tech, and their capex plans

Second-quarter earnings got off to a strong start in the US with solid results from big banks, but now markets will be focused on what the technology hyperscalers have to say about both earnings and their spending plans, says Dr. Dirk Steffen, the Private Bank's EMEA CIO.

Jul. 20, 2026

Global Chief Investment Officer Christian Nolting

PERSPECTIVES Video

CIO Video Update

Discover Global CIO Christian Nolting's outlook on markets, policy uncertainty, geopolitical tensions and Asia's growing role in shaping investment opportunities worldwide.

Jul. 09, 2026

us deficits a new twist on wicksell desktop

PERSPECTIVES Special

US deficits: A new twist on Wicksell

This PERSPECTIVES Special – US deficits: A new twist on Wicksell looks at the fundamental reasons why the US can continue to attract capital and generate wealth while running current account and budget deficits.

Jul. 08, 2026

em asia structural change desktop

PERSPECTIVES Special

Emerging structural themes across Asia

We focus on how EM Asia’s market leadership is broadening beyond the “Asia Tech” narrative, with the rally increasingly supported by three structural drivers.

Jul. 07, 2026

perspectives special humanoids desktop

PERSPECTIVES Special

Humanoids

From spectacle to substance: humanoid robots are moving out of controlled demos and into real-world tasks – but scaling reliable, cost-effective performance remains the real test.

Jul. 02, 2026

See More

In Europe, Middle East and Africa as well as in Asia Pacific this material is considered marketing material, but this is not the case in the U.S.

The value of an investment can fall as well as rise and you might not get back the amount originally invested at any point in time. Your capital may be at risk.

No assurance can be given that any forecast or target can be achieved. Forecasts are based on assumptions, estimates, opinions and hypothetical models which may prove to be incorrect. Past performance is not indicative of future returns. Performance refers to a nominal value based on price gains/losses and does not take into account inflation. Inflation will have a negative impact on the purchasing power of this nominal monetary value. Depending on the current level of inflation, this may lead to a real loss in value, even if the nominal performance of the investment is positive.

This web page is not an offer to buy a security or enter into any transaction. The products, services, information and/or materials contained within these web pages may not be available for residents of certain jurisdictions. Please consider the sales restrictions relating to the products or services in question for further information. Deutsche Bank does not give tax or legal advice; prospective investors should seek advice from their own tax advisers and/or lawyers before entering into any investment.