Email of the day on the Dollar and income
Comment of the Day

April 17 2023

Commentary by Eoin Treacy

Email of the day on the Dollar and income

Dear Eoin, Does your bearish view on the US dollar imply that investors whose income and expenditure are in currencies other than the US dollar should note be holding any assets denominated in these dollars? Regards A

Eoin Treacy's view

Thank you for this question which may be of interest to the Collective. I don’t believe absolutes are helpful when thinking about a reserve currency. A major bear market in a currency could mean it loses 50% of its value over a decade. That would boost the fortunes of exporters and potentially also raise interest rates to attractive levels. That suggests some stocks would do very well while the broader market would struggle to compensate a foreign investor relative to opportunities elsewhere. 

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