The Mighty Dollar

in economy •  2 years ago 

Here's the graph:

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source

The Dollar Index contains six component currencies: the Japanese yen, the British pound, the Canadian dollar, the Swedish krona, the Swiss franc and the euro.

Of these, only the Swiss franc is doing well. The euro is struggling thanks to energy woes. The Swedish krona shadows the euro. The pound is weak as the political classes distract themselves with a power struggle. As for the yen, it's fallen off a cliff.

In fact much of the strength of the dollar index is down to the weakness of the yen component.

For the dollar index to weaken, one or more of these currencies needs to strengthen. Maybe the pound in the unlikely event that Rishi Sunak becomes Prime Minister.

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  ·  2 years ago  ·  

Interesting about the yen. Is their downward trend permanent?

  ·  2 years ago  ·  

They're the only central bank not raising interest rates, so yes.