Citi sees US dollar weak in near term, rebounding later in 2024

A comparatively hawkish European Central Bank is likely to keep the dollar under pressure against the euro in the near term, though the greenback could recover later in the year as chances of a U.S. recession rise, Citigroup strategists said. "Tactically, we are a bit more constructive on the euro (vs the dollar) in terms of looking for the ECB to be a lot slower to pivot than the Fed," Daniel Tobon, Citi's head of G10 FX strategy said on Wednesday in a virtual panel discussion as part of Citi’s Year Ahead Conference 2024. "We do think, though, that ultimately the dollar can strengthen a bit later on in the year given our economists call for a U.S. recession and ultimately an ECB pivot," Tobon said.