What does the US dollar’s sudden about-turn mean for the markets?
We have been watching the US dollar intently on these pages for many months now, and urgently reporting on developments when and if they occur.
Today sees one such dispatch.
Over the past few days the US dollar has done one of its sudden about-turns.
What had seemed like an upward thrust, threatening to kill the likes of gold and silver stone dead, has suddenly reversed and the run that began in May now seems to be running out of steam.
A weak dollar sent asset prices soaring
In many ways the US dollar is the single most important price in the world. The dollar is, of course, the global reserve currency. Vital commodities from oil to copper to wheat – energy, metal and food, in other words – are traded in US dollars.
It is a determinant of international capital flows: is money flowing from or to the United States?
A strong US dollar is in some ways good for international stability. It is good for America’s reputation. But a weak…