Dollar Debasement Thesis Fades as USD Strength Reasserts Itself

A Yardeni Research note argues the so‑called “Dollar Debasement Trade” has largely run its course: recent market moves no longer support the idea that investors are abandoning U.S. assets. The dollar has strengthened versus the euro and yen, gold and Bitcoin have retreated, and prices for oil and copper suggest fading inflation pressures. With the Fed signaling focus on price stability and markets pricing in likely two U.S. rate hikes by early 2027, the case for a broad devaluation of the dollar appears weaker, while overseas capital flows still show demand for U.S. securities.