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Finally sit still! The Fed also want to join the "currency war"?

Full information With the world's major central Banks joining the "easing army", the federal reserve's policy statement in the early hours of Thursday morning surprised markets enough that it was hard for the fed to join the "currency wars".

In a rare "verbal intervention", ms yellen acknowledged the drag a strong dollar would have on us exports and inflation. < / p >

Market analysts say the fed deliberately USES its rhetoric to weaken the dollar, a view that, while not a consensus, is a good read on Wednesday's FOMC policy statement. And the thought can be unsettling.

Jens Nordvig, head of foreign exchange research at Nomura Holdings, said, "clearly the fed has expressed concern about the dollar, which is very important for dollar trends. The dollar is likely to be in choppy territory over the next few months."

"We've seen very little comment from the fed on the dollar, but I'm not surprised because the strength of the dollar does have an impact on the inflation outlook and economic growth in the United States," said Gary Pzegeo, head of fixed income at the Atlantic Trust Group.

"It's hard for the fed to ignore the impact of a strong dollar on the U.S. economy," said Alan Ruskin, global head of G10 currencies at Deutsche Bank AG.”

"It makes the dollar even more compelling going forward," said Matt Derr, currency strategist at Credit Suisse. "now we know the fed is watching."

“Mr Gross, a bond king, points to the federal reserve's willingness to join the "currency wars". "The rest of the world's central Banks are fighting a currency war, and I think it's about time the fed joined the fight," he said.

Since 2015, the central Banks of the euro zone, Switzerland, Australia, Canada, Denmark, Sweden and South Korea have taken measures such as cutting interest rates, buying bonds or directly intervening in foreign exchange markets. For a moment, the "currency war" clouds over the world.

The fed's "verbal intervention" in the dollar exchange rate raised the prospect that the us central bank would join the "currency war", which could exacerbate further monetary easing by other central Banks around the world.