The ‘Dollar Liquidity Shortage’ Story Is Back
On Wednesday, we (somewhat begrudgingly) documented the dollar's steady grind to YTD highs - "begrudgingly" because explaining persistent dollar strength at a time when the Fed is dovish, risk assets are surging, crude is a-bubblin' (sorry) and last month's "growth scare" narrative has morphed into this month's "cyclical reflation" story is a tedious exercise.
"The dollar rallying along with risk assets, bonds and oil is an anomaly and doesn't make sense", Morgan Stanley's Vishy Tirupattur told
I’ve mentioned this a couple times before but FX will be the thing to watch for the next crisis as long as China continues to adeptly navigate their credit bubble.