JPMorgan: No threat to the dollar’s “reserve currency” status
JPMorgan strategists assessed that the dollar could fall further in the future, but not a structural decline as Goldman Sachs stated.
“We continue to disagree with the idea that the dollar is in a much broader and long-running trend based on structural factors,” JPMorgan Currency strategists, including Daniel Hui, Paul Meggyesi, and Juan Duran-Vara, said in their August 7 notes. Structural factors include ‘the dollar losing its reserve currency status’ and ‘the recovery of the euro’s growth in the region’.
JPMorgan Chase & Co. Strategists say that the dollar may fall further, but that this is Goldman Sachs Group Inc. They note that there is no movement as their analysts pointed out last week.
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JPMorgan reported that customers had come together with some concerns about inflation as it hopes to strengthen the Fed’s efforts to support higher prices. “The emphasis on inflation and the depreciation of the currency has intensified due to the rise of gold to record levels,” strategists said.
Goldman’s commodity strategists touched on the issue last week, saying that there are real fears about the possibility of the US dollar losing its reserve currency position because of America’s policy that triggers fears of ‘currency depreciation’.
JPMorgan strategists pointed out that the indicators of inflation expectations have moved in an upward direction, and stated that this is due to the drop in the dollar, which made the biggest monthly drop in the last 10 years.