Exchange rates have been stable in the Covid crisis "'are we heading for a storm" | Kenneth Rogoff

Published Nov 16 2020 at 8:35 AM GMT
  • There has been a surprising lack of volatility during the pandemic and US election, but this could changeWith alternative assets such as gold and Bitcoin thriving in the pandemic, some top economists are predicting a sharp fall in the US dollar.
  • But so far, despite inconsistent US management of the pandemic, massive deficit spending for economic catastrophe relief, and monetary easing that the Federal Reserve chair Jerome Powell says has 'crossed a lot of red lines", core dollar exchange rates have been eerily calm.
  • Even the ongoing election drama has not had much impact.
  • Traders and journalists may be getting worked up about the greenback's daily travails, but for those of us who study longer-term exchange-rate trends, their reactions to date amount to much ado about nothing.
  • To be sure, the euro has appreciated by roughly 6% against the dollar so far in 2020, but that is peanuts compared with the wild gyrations that took place after the 2008 financial crisis, when the dollar fluctuated between $1.58 and $1.



  • Published Nov 16, 2020 8:35 AM GMT