Hatred Of The Dollar From A Global Perspective

Traders know that the U.S. Dollar Index ETF UUP has been losing ground… fast. Year-to-date, the performance of the fund is worse than -7%. In the past twelve months, the fund has lost 18% of its value. As the value of the dollar declines, traders, banks, and even countries become concerned about the solvency of the American currency that has long been a benchmark standard in the global markets. In a market of constantly fluctuating exchange rates and the never ending strengthening and weakening of money, leave it to the U.S. dollar to be one of the few currencies that are remaining steady and consistent- refusing to buy the U.S. dollar. Expectations that American interest rates will remain near all-time lows for the time being has caused demand for the currency to drop and the exchange rate has suffered as a result. With a continued supply of unsettling economic data, it looks as though there are few forces left to strengthen the greenback. Interest rate decisions from the central banks of Australia, around 1.5 percent away from record highs today after more bad news about the state of U.S. unemployment pushed the dollar further downward. Demand for gold has increased as it is seen as a universal currency during times of economic unrest. With the steady stream of more bad news about the state of the American economy, it is safe to say that the dollar has seen better days. Moreover, with Chinese President Hu Jintao's prediction that the U.S. dollar dominated world is a , it will be interesting to see if his prediction comes true. Americans definitely have reason to hope not.