Today, we’re fortunate to have Willem Thorbecke, Senior Fellow at Japan’s Research Institute of Economy, Trade and Industry (RIETI) as a guest contributor. The views expressed represent those of the author himself, and do not necessarily represent those of RIETI, or any other institutions the author is affiliated with.
So be prepared. From Feng, Han, and Li (2023):
Mark Sobel at OMFIF discusses the likelihood of an new Plaza Accord to depreciate the dollar. Given one would need Euro area and Chinese agreement, the assessed likelihood is low
Consider the ruble/yuan exchange rate.
From Politico:
The ruble tumbled on Wednesday to its lowest level in over two years, as a mix of low oil prices, new sanctions against Russian businesses and burgeoning government spending on its war effort put ever-greater strain on the Russian economy.
The central bank reacted by suspending currency purchases for the rest of this year. That will restrict the supply of rubles and should support the exchange rate accordingly.
Today, we are pleased to present a guest contribution written by Joshua Aizenman (University of Southern California) and Jamel Saadaoui (Université Paris 8-Vincennes). This post is based on the paper of the same title.
Consistent with expansionary fiscal policy plus tariffs hitting a non-passive Fed reaction function.
What else would one expect from expectations of expanded budget deficits, higher incipient inflation in the context of a Taylor rule reaction function, when the currency is a safe haven asset?
From EJ Antoni and Peter St. Onge channel Vladimir Putin (Feb 2024):
America’s political establishment has less respect for the U.S. dollar than our foreign adversaries.
That was made clear when Tucker Carlson recently interviewed the Russian strongman President Vladimir Putin, who clearly articulated how the uniparty in Washington is destroying America’s greatest strategic and economic asset — her currency.
Joe Biden is dethroning King Dollar in real time. The US dollar’s financial dominance is under siege from a uniquely bad combination of foreign and domestic policies, and Americans should be deeply concerned by the fallout if the dollar loses its 80-year reign as the world’s reserve currency.