At Any Rate Global FX: How much is too much?
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Feb 13, 2026 
James Nelligan, J.P. Morgan FX analyst on European and Scandi currencies, and Patrick Locke, J.P. Morgan FX analyst focused on dollar dynamics, discuss limits to dollar weakness. They cover why US equity underperformance can be dollar-negative, surprising payrolls reactions, yen moves after Japan’s vote, Scandi and sterling strength, Swiss franc flows, and signals from a firmer US Treasury FX stance.
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Dollar Weakness In A New Regime
- The dollar is down amid a semi-structural pro-growth, dollar-bearish regime that breaks usual fair-value models.
- Watch breadth of growth signals, front-end US rates, dollar-CNY fixes, and US vs. world equity dynamics for signs to reverse that view.
Equity Relative Performance Drives Dollar Moves
- Relative US equity underperformance is dollar-negative, while global equity declines are dollar-positive, so offsetting forces can mute dollar moves.
- A return to the 2Q25 correlation where US equity sell-offs lift the dollar would materially change FX dynamics.
Payroll Surprise, Dollar Flimsy Response
- Strong payrolls didn't strengthen the dollar as expected despite firmer-than-forecast labour data and a short-end rates pop.
- Markets priced out an early Fed cut, creating tension between data and dollar reaction that surprised Patrick Locke.