Search
 
Analysis

Hedge Funds, Wall Street Double Down on the Dollar

“Until either the Fed turns dovish or global growth expectations bottom, the dollar will remain king.”

By Ruth Carson | July 15, 2022 at 11:32 PM
Photo: $100 bills being counted by a machine. Photographer: Toru Hanai/Bloomberg

The dollar rally has room to run, and those who stand in its way risk getting bowled over by its unstoppable strength. That’s the view of hedge funds and investment banks from New York to Melbourne, as a Bloomberg gauge of the world’s reserve currency heads higher, breaking past its pandemic peak to a fresh record.

Potential catalysts are numerous and lie on both sides of the dollar smile argument—which suggests the U.S. currency can benefit in times of strong growth and during an economic slowdown. Investors say it may only be a matter of time before anything from a hawkish Federal Reserve to a global recession turbocharges the greenback higher.

“Don’t fight it; it’s not the right time to go against dollar strength yet,” said George Boubouras, head of research at hedge fund K2 Asset Management in Melbourne, who sees the greenback rising against everything from emerging-market currencies to the euro. “You can’t see a bottoming out of developed-market recession risks—it’s too difficult to short the dollar anytime soon.”

Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.

Your access to unlimited Treasury & Risk content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical Treasury & Risk information including in-depth analysis of treasury and finance best practices, case studies with corporate innovators, informative newsletters, educational webcasts and videos, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM websites including PropertyCasualty360.com and Law.com.

Already have an account?

NOT FOR REPRINT

© 2023 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

 

Recommended Stories

U.S. Dollar Has Strong Start to 2023

U.S. Dollar Has Strong Start to 2023

Alice Gledhill |

Only the Japanese yen has proved stronger than the greenback among G-10 currencies so far this year, with the Norwegian krone, euro, and Swiss franc falling sharply.

Treasury & Risk

Join Treasury & Risk

Don’t miss crucial treasury and finance news along with in-depth analysis and insights you need to make informed treasury decisions. Join Treasury & Risk now!

  • Free unlimited access to Treasury & Risk including case studies with corporate innovators, informative newsletters, educational webcasts, and resources from industry leaders.
  • Exclusive discounts on ALM and Treasury & Risk events.
  • Access to other award-winning ALM publications including PropertyCasualty360.com and Law.com.

Already have an account? Sign In Now
Join Treasury & Risk

Copyright © 2023 ALM Global, LLC. All Rights Reserved.