De-dollarization risks aren't priced in despite rising US dysfunction and tension with China, JPMorgan says

• De-dollarization risks aren't priced in despite rising US dysfunction and tension with China, JPMorgan said.
• The dollar is "very expensive in historical terms, suggesting that a narrative of secular dollar decline is not prevalent in the market."
• Investors should go underweight on the dollar, as well as US markets, bonds, and financial equities, analysts said.

De-dollarization risks aren't priced in despite rising US dysfunction and tension with China, JPMorgan said.

In a note Tuesday, strategists said that so far there isn't much evidence of de-dollarization. While the dollar's share of international reserves dropped from 73% in 2001 to 58% in 2022, its share in sovereign wealth funds has grown, more than offsetting the decline in reserves.