‘Whether President Trump can win the trade war and the ‘FX war’ seems rather doubtful.’

step since 2000, when it joined an international effort to support the euro.

Intervention carried out for more than a few weeks could backfire and become supportive of the dollar, according to an analysis by UBS Group. For it to work, U.S. growth and carry advantages must both be blunted while the growth outlook in China and Europe improves, UBS said. That’s not a scenario economists expect.

“The more likely outcome of the explicit currency war would be further extension of uncertainty, which ironically could prove to be dollar-positive if risk assets fear weaker growth and volatility pushes higher,” UBS strategists including Bhanu Baweja wrote in a note. They said it would also “shift rate differentials in the dollar’s favor, albeit with a lag” as other central banks respond with dovishness.

Three central banks across the Asia-Pacific region delivered surprise interest rate decisions Wednesday: New Zealand and India led with bigger-than-expected interest rate cuts, and Thailand’s 25point reduction surprised all but two economists in a Bloomberg survey.

Chris Chapman, a portfolio manager at Manulife Investment Management, is keeping most of his non-dollar exposure hedged, even though the market is expecting the Federal Reserve to cut interest rates at least two more times in 2019. The issue here is that other central banks are cutting rates and easing policy. China looks set to step up stimulus to revive growth, while the European Central Bank has flagged fresh monetary action for as early as September.

“The dollar could stay strong, as other central banks are also pursuing accommodative policy,” Chapman said. “The current market feels a little like there is a tug-of-war between what lower U.S. rates would do to the dollar versus the f light to safety flows.”