Recently, a completely counterintuitive mechanism has occurred: the dollar is a safe-haven currency and appreciates even when there is trouble in the United States, Natixis analysts report.
In the spring of 2023, all the ingredients are normally in place for the dollar to weaken
“In the spring of 2023, all the ingredients are normally in place for the dollar to weaken: Very weak growth prospects in the United States; US public debt default risk due to debt ceiling; Banking crisis affecting more and more regional banks; Consumer confidence indices fell in April.
“However, the dollar is not devaluing, but on the contrary strengthening against all currencies: the USD is a safe haven even when the United States is in trouble, which is paradoxical.”
