In recent newsletters I've written extensively about the important role that the US dollar plays in determining price moves across a range of assets. I summarised this succinctly in my newsletter titled "Don't fight the US dollar". Just to reiterate...
"A strong dollar not only tends to hit US stocks but also commodities (especially gold) as well as proving a headwind for Asian and emerging markets. In contrast, a strong dollar versus the Japanese yen tends to be positive for the Nikkei 225, while a weaker pound versus the stronger US dollar can provide some support for the FTSE 100.
The US dollar index [which measures the strength of the dollar against a basket of currencies] goes a long way to explaining many of the market moves we've seen this year, especially since mid-June. [During the first week of September] the US dollar index began to fall, as a result of a more hawkish ECB.
Full article available exclusively to 80-20 Investor members.
To read the complete article, sign up for a free trial or log in below.
Start a free trial Already have an account? Log in
