George Boubras, who was playing cricket at his home in Melbourne, rang at around 10:45 pm on July 13.
Euro is against the US dollar for the first time in about 20 years, 1 euro = 1 dollar parity (Equivalent) is interrupted. Boubras, head of research at hedge fund K2 Asset Management, told clients, fund managers and traders seeking advice on how to move. “Now we shouldn’t go against the US dollar”
Only about an hour later, like the European Central Bank (ECB), it was struggling to stabilize its currency against the US dollar.Bank of Canada decides to raise interest rate by 1 point. It was something that almost no one expected. After 10 hours, another shock will strike.The Singapore Monetary Authority (MAS) will change the median fluctuation range of the exchange rate policy band to a level that reflects market conditions in order to raise the Singapore dollar.Announced.
“It all happened in a ridiculously short time. It was an incredible mess,” said Mittal Kotecha, an emerging market strategist at TD Securities. He left Singapore to visit a Thai resort on vacation to celebrate his 25th wedding anniversary with his wife.
The rise in the US dollar, the key currency, has caused a number of disasters so far, mainly as a result of aggressive rate hikes by US financial authorities. Pushing up food import prices and exacerbating poverty in each region of the world.In Sri Lanka, default (default) forced President Rajapaksa to resign. Equity and bond investment losses have spread in the global financial markets.
Bloomberg Dollar Spot Index hit record high in JulyThe US dollar has risen about 15% against major currencies since the middle of 2009, including renewals. Long-time foreign exchange watchers see little material to put a brake on the appreciation of the US dollar, as US officials have shown their determination to continue raising rates to curb inflation, even if the world is in recession.
This situation is reminiscent of the 1980s, when financial authorities continued to raise rates significantly to combat inflation under the then chairman of the Federal Reserve Board (FRB).For this reason, in the market, major countries cooperated in 1985 to correct the appreciation of the US dollar.The possibility of recreating the Plaza Accord is also whispered. It seems unlikely that it will happen so far, but it is only a matter of time before these observations reignite, given some indicators that suggest a further rise in the US dollar.
Mizuho Bank’s head of economics and strategy, Vishnu Barasan, said, “The euro area is facing Ukraine and China’s economic growth is uncertain. Now, simply look everywhere to replace the US dollar. It has no wealth, and as a result it is overwhelming the economy, other currencies and corporate interests. “
The reason for the growing demand for the US dollar is simple. When the world’s financial markets are turbulent, investors seek a haven. The size and strength of the US economy is still unmatched, and US Treasuries are still considered one of the safest assets. And the US dollar is the currency that makes up the majority of the world’s foreign exchange reserves.
US Treasury Secretary Baker at a press conference after the Plaza Accord (at that time, September 22, 1985)
Photographer: Mario Cabrera/AP Photo
Bank of America (BofA) Monthly Fund ManagerAccording to the survey, a bullish position on the US dollar reached its highest level in seven years, making it one of the most concentrated transactions. It can be taken as a message that we should not think about confronting the US dollar’s dominance now.
“If the US dollar turns down, it’s when investors are ready to invest in high-risk assets again,” said Jane Foley, head of foreign exchange strategy at Rabobank. “It won’t happen until the market is convinced that the US monetary authorities have changed the direction of monetary policy,” he said.
news-rsf-original-reference paywall">Original title:
news-rsf-original-reference paywall">King Dollar Upends the Global Economy With No End in Sight（抜粋）
