DXY

US Dollar Index

According to the Fed minutes released on Wednesday, officials were split on whether the greater risk to the economy was a cooling labor market or high inflation.

Kansas City Fed’s Jeff Schmid emphasized on Monday the need to remain vigilant about inflation that has remained sticky.

The relatively resilient growth in the rest of the world versus the U.S. and the Fed easing could make for an “active risk-on” environment, fueling gains in both risk and rate-sensitive currencies, which are cheap, a strategist said.

Confirmation of a weak labor market is seen as the trigger that can push the Federal Reserve under Jerome Powell to announce its first cut this year.

The billionaire investor predicts a weaker dollar, a steeper yield curve, and stocks doing relatively poorly despite the easing.

The dollar has also been facing pressure amid moves among BRICS and a few other nations to diversify their currency reserves away from the dollar and use alternative currencies for trade purposes.

Hanke cited the findings of Bank of America’s Global Fund Manager survey, which showed that fund managers are the most bearish on the U.S. dollar in 20 years.

According to Dalio, once people start to lose trust in the fiat system, a specific cause-and-effect reaction could occur that would result in linking money back to gold.

Investing.com -- BCA Research’s MacroQuant model is signaling rising risks for equity investors, though the firm stopped short of calling for an imminent bear market.