U.S. Stock Outperformance Portends More Dark Days for Dollar
- Greenback may weaken as global investors rebalance allocations
- Managers adjust holdings before end of month, quarter or year
This article is for subscribers only.
The dollar’s weakest quarter in a decade may get even worse as investors respond to the effects that massive American equity-market gains have had on the composition of their portfolios.
The Bloomberg Dollar Spot Index has plunged close to 5% this quarter and is on track for its biggest slide since 2010 as America’s economy shows signs of recovering from its pandemic-induced slump. That more upbeat narrative has helped to underpin a 7% rally in the S&P 500 Index that puts to shame gains in stocks from Japan to the euro area and Canada -- not to mention losses for U.K. and Australian equities.