The U.S. currency is set for another soft year despite a hawkish Federal Reserve that could hike interest rates up to four times in the next twelve months, a Goldman Sachs economist told CNBC Tuesday. "We still think the dollar is probably going to be relatively soggy, at least against the majors, probably against the emerging economies to a significant degree as well," Jan Hatzius, chief economist at Goldman Sachs, said. Rate rises by a central bank traditionally boost a currency as it promotes investors to flock to a country with the anticipation of higher-yielding assets. However, Hatzius believes that we are now in a "fairly synchronized global upswing" where other central banks are also looking to push benchmark rates higher, diminishing the appeal of the U.S.

A trader at FXCM in Japan. Michael Caronna | Reuters

"(In) that sort of environment it's usually hard to see large dollar appreciation, so generally slightly softer is the basic view," he added. The dollar index, which compares it to a basket of global currencies, was down around 10 percent last year after several years of gains as the U.S. economy improved following the global economic crash. Now the consensus from market watchers suggests it could see another weak year as other global regions pick up. Many cite uncertainty over the currency, including on the policies that could be delivered by President Donald Trump. "There are the doubts on Trump — which is causing a sense of befuddlement among international investors about the dollar as the ultimate store of value and America's place in the global economy — and there is a growing sense of unease about the economy's ongoing resilience. These two repeat factors keep pulling any dollar recovery down and mean we remain in cautious wait and see mode about the U.S.," Bill Blain, strategist and head of capital markets at Mint Partners, told CNBC via email.