http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/ US Dollar No Longer Dominant Are the glory days of the US dollar fading? Is the US dollar no longer dominant in Forex markets? The Financial Times writes that the greenback is no longer the dominant safe haven currency. Has the king of currencies been dethroned? The dollar is no longer the catch-all haven currency of the past. Thank “idiosyncratic risks”, say analysts at Bank of America Merrill Lynch. Adarsh Sinha, a strategist at the US investment bank, crunched the numbers and found the greenback hasn’t really been “safe” since 2014. It has tended to depreciate against most of the major currencies during nervous episodes, he notes. “Perhaps unsurprisingly, this coincided with the end of Fed [quantitative easing] and the emergence of more aggressive easing by the European Central Bank and Bank of Japan,” said Mr Sinha. Other analysts note that the dollar tends to be correlated with the S&P 500 which is a rough measure of the strength of the US economy. But during times of financial stress that relationship is not always a good thing. For those seeking a safe haven currency the likelihood of the dollar becoming volatile along with the US stock market is not reassuring. Japan’s yen comes in as the best safe haven currency as it holds up fine when Europe, North America and China are under financial stress. Unfortunately with trouble brewing next door on the Korean peninsula the yen has its problems as well. Reserve Currencies Investopedia in their article about Forex trading writes that the US dollar is the world’s most significant currency and the dominant reserve currency since World War II.

1. US Dollar No
Longer Dominant
By www.ForexConspiracyReport.com

2. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Are the glory days of the US dollar
fading?

3. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Is the US dollar no longer dominant in
Forex markets?

4. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
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5. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
The Financial Times writes that the
greenback is no longer the dominant
safe haven currency.

6. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Has the king of currencies been
dethroned?

7. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
The dollar is no longer the catch-all
haven currency of the past.

8. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Thank “idiosyncratic risks”, say analysts
at Bank of America Merrill Lynch.

9. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Adarsh Sinha, a strategist at the US
investment bank, crunched the
numbers and found the greenback
hasn’t really been “safe” since 2014.

10. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
It has tended to depreciate against
most of the major currencies during
nervous episodes, he notes.

11. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
“Perhaps unsurprisingly, this coincided
with the end of Fed [quantitative
easing] and the emergence of more
aggressive easing by the European
Central Bank and Bank of Japan,” said
Mr Sinha.

12. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Other analysts note that the dollar
tends to be correlated with the S&P
500 which is a rough measure of the
strength of the US economy.

13. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
But during times of financial stress that
relationship is not always a good thing.

14. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
For those seeking a safe haven
currency the likelihood of the dollar
becoming volatile along with the US
stock market is not reassuring.

15. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Japan’s yen comes in as the best safe
haven currency as it holds up fine when
Europe, North America and China are
under financial stress.

16. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Unfortunately with trouble brewing
next door on the Korean peninsula the
yen has its problems as well.

17. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Reserve Currencies

18. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Investopedia in their article
about Forex trading writes that the US
dollar is the world’s most significant
currency and the dominant reserve
currency since World War II.

19. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
The United States dollar is by far the
most significant currency in the global
market;

20. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
it is the dominant reserve currency of
the world, it represents nearly half of
the trading volume of the major
currencies, and it is the default
currency for most transactions.

21. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Given that the U.S. economy is far and
away the largest single economy in the
world (close to three times the size of
second place China), it is not surprising
that the U.S. dollar holds the position
that it does.

22. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Before the Second World War the
British Pound occupied a position
similar to what the dollar has today.

23. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
That changed with the carnage of the
war and Britain’s loss of its empire.

24. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Today nearly half of Forex trades
include the dollar and the dollar is still
the world’s leading reserve currency
followed by the euro, yen pound and
Swiss franc.

25. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
But the change over the years is telling.
Between 1999 and 2013 the percent of
total foreign currency reserves held as
dollars fell from 71% to 61% while euro
climbed from 17.9% to 24.4%.

26. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
The percentages for the pound, euro
and franc rose slightly while yen also
experienced a drop from 6.4% to 3.8%.

27. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
The Passage of Time

28. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
All things change over time. The
fundamental value of a currency
depends on the strength of its
economy, its balance of payments and
its monetary policy.

29. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
In the case of the US dollar it also
depends on the US congress dealing
responsibly with the huge US debt.

30. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
Over the years the debt has grown and
so has political divisiveness.

31. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
That is a recipe for disaster and not
good for the dollar.

32. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
When foreign governments decide
which currency to put away in reserve
they want the one that has a
responsible monetary policy and
responsible government attached.

33. http://www.forexconspiracyreport.com/us-dollar-no-longer-dominant/
It remains to be seen how this will
work out for the US dollar and its
current dominance.