BCA's Chester Ntonifor says U.S. dollar is 'deeply overvalued'

Summary

Chester Ntonifor, BCA Research chief strategist, argues the U.S. dollar remains deeply overvalued on purchasing-power-parity and competitiveness measures and expects further multi-year depreciation into 2026-2027. He also says investors should hold some dollars as a hedge against rising volatility and a market regime shift. He sees China's deflation pressuring the yuan's long-term fair value while many emerging-market currencies offer attractive carry, citing Mexico and Poland.

• BCA's Chester Ntonifor says the U.S. dollar is overvalued by about 15-20% on PPP.
• He expects the dollar to depreciate further over the next 2-3 years, including into 2026-2027.
• He says the dollar is no longer reliably defensive but remains the global reserve currency and safe haven.
• He recommends holding some dollars as a hedge against rising volatility.
• He says China's deflation pressures the yuan's long-term fair value.
• He sees attractive carry in emerging-market currencies, citing Mexico and Poland.
• The interview covers FX volatility, dollar correlations, and emerging-market currency opportunities.