The latest sentiment survey of chief investment officers from UK-based Asset Risk Consultants reveals significant negative sentiment towards the dollar.

The Asset Risk Consultants' (ARC) investment manager sentiment survey of CIOs shows that the US dollar is the most negatively rated asset class among wealth managers.

Its market sentiment survey, a quarterly poll of 107 investment management CIOs examining the 12-month outlook for the main asset classes and sectors, reveals that negative sentiment towards the US dollar has increased significantly over the past year.

During the second quarter of 2025, sentiment towards the dollar recorded a net change of minus 78 compared with the second quarter of 2024 amid expectations that the US Federal Reserve would cut ahead of other central banks and mounting concerns over US deficits and credit downgrades. 

While the dollar is now the most negatively rated asset in the survey, alternatives led the way with the strongest positive readings, with optimism concentrated on gold, commodities and hedge fund strategies. Equities and cash drew more moderate support from CIOs, while bonds remain evenly balanced, reflecting uncertainty around the path of interest rates.

“We think that the recent shift in sentiment against the US dollar reflects more than just momentum,” Dan Hurdley, managing director at ARC Research, said. “While US policymakers may welcome a weaker currency to boost trade competitiveness, investors are looking ahead. Concerns are growing that deliberate depreciation could fuel inflation and raise interest burdens, sparking fears of a downward spiral.”

“The dollar’s reserve currency status, once unquestioned, is now under increasing scrutiny. After years of outperformance, many managers are trimming dollar exposure as part of broader rebalancing and reassessing hedging strategies given the impact of currency moves on global portfolios," he added.

ARC’s previous sentiment survey revealed its biggest negative US sentiment swing for 15 years. The geopolitical and macroeconomic backdrop shaped by the early months of US President Donald Trump’s return has led many firms to reassess exposure to US assets, according to the survey.

ARC advises on over $22 billion of assets invested across more than 200 banks and investment firms for clients from over 20 jurisdictions around the world.