The dollar’s fall in July to a two-year low against the euro was the immediate impetus for these stories. In fact, the dollar’s recent slide is one in a series of readily explicable fluctuations. When the COVID-19 pandemic went global in March, the dollar strengthened on the back of safe-haven flows into US Treasuries, as it does at the start of every crisis. By May, the Federal Reserve, acting as global lender of last resort, had accommodated this mad scramble for dollars by pouring buckets of liquidity into financial markets, and the greenback gave back its early gains.
Then he talks rates vs currency exchange. Then wanders off into trade an balance of trade. Gets in a few digs at Trump.
I covered this. Except the delay between rates and exchange. The post calls it expectation, I call it the currency insurance step. The currency traders offset potential currency fluctuations, their job takes bandwidth, that appears as a delay on the time chart. This is the self sampled property, uncertainty is under sampling and that is spread out, partition up to a point.
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