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Markets: The death of the dollar may be beginning

2020-01-07 12:25:59

Our discussion of the Markets and the Death of the Dollar will be covered in this article with precise details.

Is the Death of the Dollar in the Markets possible?

 Recently in December the dollar went through some bad times, which could be worse, these opinions were expressed by M&G Investments Ltd, Brandywine Global Investment Management and ABN Amro Bank NV, which are fund managers and strategists, that the current truce between the U.S. and China could be a major influence on global growth and could weaken the currency by reducing the premium on treasury bond yields. In addition, Jack McIntyre said that growth is expected in the rest of the world and that the main cause of the dollar's death in the markets will be due to economic changes in growth in the U.S. and China.The death of the dollar in the markets will be due to economic changes in growth between the US and the rest of the world.

 In December, the dollar suffered its worst fall in two years, reaching 2 percent, which did not allow it to maintain the gains made at the beginning of 2019. The dollar also obtained a 40 percent recovery, from a minimum in 2011 to 2017, when it reached its maximum at the beginning of the year, as a result of a trade agreement between Washington and Beijing. According to the Commodity Futures Commission's reference data, it is possible that the markets will be affected by what is most feared, which is the death of the dollar. Certainly, in 2019 this currency will find a refuge, said Georgette Boele, currency strategist at ABN Amro Bank in Amsterdam, that in the long term there is talk of a greater weakness.

Why the additional pressure against the USD?

 It is also against the fact that the Federal Reserve lowered the benchmark rate in July, September and October, which slowed down growth, being an important pillar to further undermine the markets. It is predicted that in 2020 the Federal Reserve may lower the benchmark rate, which will result in the death of the dollar, the mediocrity of which brings with it the mediocrity of the U.S. elections, this said by Jim Leaviss, head of fixed income at M&G Investments in London.

With a drop of 80 points over the year, we have that has been presented by the 10-year treasury bonds, has only been advantaged by the 2-year yields of the U.S., the federal reserve, in the debt that has Germany which has a very similar maturity to reach the reduction of 217 points to about 350 at the end of 2018, Bloomberg gives us this data to know about it.

 Why is the death of the dollar in the markets not concrete for many?

 There is the possibility that there will be a considerable rise in the dollar, compared to the euro and the Canadian dollar, as far as the economy of the United States is concerned it is possible that it will be above those of the whole world, the fall of the dollar is possible if the appreciation value increases specifically of the euro and the yuan, but for this to happen the possibilities are too few said by Goldman Sachs, there is another vision in which the death of the dollar in the markets is expected, in terms of a sudden sale being a lower blow.

 It is clear that at the beginning of this 2020 the dollar is still overvalued, said this by the bank's strategists, including Ray Attrill in Sydney, after conducting an investigation on the matter, it is slowly possible to expect the dollar to fall, the opposite could happen if growth outside the US improves and the federal reserve becomes more flexible by resuming.

 We come to the end of this explanation, which was based specifically on The Death of the Dollar in the Markets, and we hope that this information was useful to those who took the time to read this content.

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