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Why the US dollar will continue to shine
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The US dollar will maintain its critical position in global portfolios despite worries about its future.
PHOTO: REUTERS
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The dollar is regaining its crown as one of the world’s most appealing assets, defying talk of a “Sell America” trade that had raised troubling questions about the outlook for the global reserve currency.
A simple strategy of borrowing in low-yielding currencies like the Japanese yen or the Swiss franc and putting your money in dollars looks set to beat the implied returns on markets such as European stocks and Chinese government bonds once the volatility of these assets is taken into account, according to Bloomberg calculations.
