We’ve already seen in the space of a few short weeks the market adjust its expectations for rate cuts this year from around six 25-bps reductions to four.
In some ways we can look at the valuation of the dollar as something of a balancing act.
It’s likely you’ve heard the saying that ‘when the US sneezes the rest of the world catches a cold’. It might not always be true but that’s cold comfort to those outside...
The US dollar has fallen by close to 10% in trade-weighted terms from the 20-year peak that we saw last October.
The US dollar has the upper hand at the moment with other currencies hit by what can be called a double whammy.
In the past year, we’ve seen 10-year US treasury yields rise from around 0.9% to 1.4% today.
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