Currency Clash

When the Fed announces a third round of quantitative easing, expect unintended cross-currency consequences. Last time, the dollar fell against a host of currencies, but now central banks in many of those same countries will actively intervene to prevent their currencies from appreciating against the greenback. However, other countries seem unprepared to intervene such as Australia, New Zealand and South Korea. As a result, bet on their currencies rising.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.