Years ago, high U.S. inflation meant a weak dollar. So far, it is different this time, and many on Wall Street are betting it will stay that way.
The dollar is reaching multidecade highs against its trading partners, even with U.S. inflation at its highest level in nearly 40 years. The U.S. Dollar Index, which tracks the currency against a basket of others, is reaching highs unseen since 2002. The greenback's climb has sent the euro, British pound and Japanese yen tumbling.
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That is a different story than the one that played out in the inflation-plagued 1970s. The dollar plunged nearly 40% against West Germany's mark , then one of Europe's most influential currencies, between January 1974 and 1980, according to Federal Reserve Bank of St. Louis data. Federal Reserve Chairman Paul Volcker in 1979 began sharply raising interest rates, fueling a strong recovery.
Investors contend that economic weakness world-wide is driving today's strong dollar. The war between Ukraine and Russia is driving up energy costs for European households, which depend on Russia for natural gas, and around the world. The eurozone's economy faces the threat of a recession.
The picture in the U.S. is different. Consumers have more money in bank accounts. Even as prices rise, Americans are spending. Data show businesses pouring money into equipment and research and development. Fed Chairman Jerome Powell expressed confidence that the economy could weather a series of interest-rate increases at the Fed's policy meeting Wednesday.
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Traders will this week parse consumer-spending data and Friday's monthly jobs report for clues regarding the health of the economy and the trajectory of the stock market. U.S. stocks fell sharply Thursday, erasing gains from the previous session.
Chris McReynolds, head of inflation trading at Barclays and formerly a foreign-exchange trader, said the dollar is outpacing other currencies because inflation and growth prospects in other countries are worse. The U.S. Dollar Index is up 14% over the past year.
The U.S. economy was much less damaged by Covid than others.
- said Mr. McReynolds.
Rick Rieder, BlackRock's bond chief and head of fixed income, said he is buying the dollar and selling currencies hit by weaker economic growth relative to the U.S., including the euro, the offshore Chinese renminbi and small amounts of the yen.
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Currency derivatives markets indicate investors expect the dollar to continue to outperform. Traders at banks said clients are buying options that pay off if the dollar continues to rise: Call options for the dollar versus the yen became more expensive than puts in March, a reversal in a metric traders use to gauge demand for the dollar.
A strong dollar allows Americans to buy goods from other countries at lower prices. But it can also hurt U.S. manufacturers by making products more expensive for foreigners, and it means U.S. businesses receive fewer dollars for their exports. $Microsoft(MSFT.US)$ said in its earnings report earlier this month that a stronger dollar reduced the software company's revenue, even though it notched higher profits last quarter.
In the 1970s, inflation and the 1973 Arab oil embargo dragged the greenback down. Europe today is grappling with its own energy-supply shortage and growth concerns, potentially leading to a phenomenon known as stagflation, marked by rising prices and slowing growth, which often prompts investors to sell a currency. The euro has lost nearly 13% against the dollar during the past year.
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Stephen Gallo, European head of FX strategy for BMO Capital Markets, said investors' perception of how central banks will act is boosting the dollar. The European Central Bank has yet to raise interest rates, with President Christine Lagarde earlier this month saying it will lag behind the Fed in tightening monetary policy. The Bank of Japan also recently reinforced its commitment to low interest rates.
Interest-rate derivatives show that investors expect the Fed to increase its benchmark federal-funds rate from its current level between 0.75% and 1% to just above 3% next year.
The central banks more credible at targeting inflation will attract most of the flows. The Fed has finally signaled it's taking the inflation problem seriously.
-said Nafez Zouk, an analyst at Aviva Investors.
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Another reason for the dollar's dominance: the consistent outperformance by U.S. assets of European assets. One measure of this can be seen in global stocks: Over the past decade, stocks in the U.S. have earned investors outsize returns, while their European counterparts have remained lower and largely rangebound. The S&P 500 in December was up more than 400% since 2009, compared with a 137% advance in the Stoxx Europe 600 over the same period.
Keith Decarlucci, chief investment officer of London-based hedge fund Melqart KEAL Capital, who has traded currency markets for more than 30 years, said the dollar's status as a haven amid geopolitical uncertainty and role as the world's reserve currency puts it in a stronger position today than in the 1970s, when the U.S. imported more oil and abandoned the gold standard.
But Morgan Stanley and Barclays expect it to fall over the course of the year. Strategists said the currency won't look as attractive as economic growth picks up in Europe or if inflation in the U.S. sticks above 3%.
Write to Julia-Ambra Verlaine at julia.verlaine@wsj.com
幾年前,美國的高通脹意味着美元疲軟。到目前為止,這一次的情況有所不同,華爾街的許多人押注這種情況將保持不變。
儘管美國的通貨膨脹率處於近40年來的最高水平,但美元兑其貿易夥伴的匯率仍達到了數十年來的最高水平。跟蹤美元兑一籃子其他貨幣匯率的美元指數正在達到2002年以來的最高水平。美元的升值導致歐元、英鎊和日元暴跌。
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這與上世紀70年代飽受通脹困擾的情況截然不同。聖路易斯聯邦儲備銀行(Federal Reserve Bank of St.Louis)的數據顯示,1974年1月至1980年間,美元兑當時歐洲最具影響力的貨幣之一西德馬克暴跌近40%。1979年,美聯儲主席保羅·沃爾克開始大幅提高利率,推動了經濟的強勁復甦。
投資者認為,全球經濟疲軟正在推動今天的強勢美元。烏克蘭和俄羅斯之間的戰爭正在推高依賴俄羅斯天然氣的歐洲家庭以及世界各地的能源成本。歐元區經濟面臨衰退威脅。
美國的情況則有所不同。消費者的銀行賬户裏有更多的錢。即使物價上漲,美國人也在花錢。數據顯示,企業在設備和研發方面投入了大量資金。美聯儲主席傑羅姆·鮑威爾在週三的美聯儲政策會議上表示,有信心美國經濟能夠經受住一系列加息。
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交易員本週將分析消費者支出數據和週五的月度就業報告,以尋找有關經濟健康狀況和股市走勢的線索。美國股市週四大幅下挫,抹去了前一交易日的漲幅。
巴克萊通脹交易主管、前外匯交易員麥克雷諾茲(Chris McReynolds)説,美元的表現優於其他貨幣,因為其他國家的通脹和增長前景更糟。美元指數在過去一年裏上漲了14%。
與其他國家相比,美國經濟受到Covid的損害要小得多。
“麥克雷諾茲先生説。
貝萊德的債券主管兼固定收益業務主管裏德説,他正在買入美元,拋售受到相對於美國經濟增長疲軟打擊的貨幣,包括歐元、離岸人民幣和少量日圓。
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外匯衍生品市場顯示,投資者預計美元將繼續跑贏大盤。銀行的交易員説,客户正在買入期權,如果美元繼續上漲,這些期權會帶來回報:3月份,美元兑日元的看漲期權變得比看跌期權更貴,交易員用來衡量美元需求的指標發生了逆轉。
強勢美元使美國人能夠以更低的價格從其他國家購買商品。但它也會讓外國人的產品變得更貴,從而損害美國製造商的利益,並意味着美國企業從出口中獲得的美元減少。$微軟(MSFT.US)$在本月早些時候的收益報告中表示,美元走強減少了這家軟件公司的收入,儘管它上個季度實現了更高的利潤。
在20世紀70年代,通貨膨脹和1973年的阿拉伯石油禁運拖累了美元。如今的歐洲正在努力應對自身的能源供應短缺和對增長的擔憂,這可能會導致所謂的滯脹現象,其特點是價格上漲和增長放緩,這往往會促使投資者拋售一種貨幣。在過去的一年裏,歐元兑美元匯率下跌了近13%。
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蒙特利爾銀行資本市場(BMO Capital Markets)歐洲外匯策略主管斯蒂芬·加洛(Stephen Gallo)表示,投資者對各國央行將如何行動的看法正在提振美元。歐洲央行尚未加息,總裁拉加德本月早些時候表示,在收緊貨幣政策方面將落後於美聯儲。日本央行最近也強化了維持低利率的承諾。
利率衍生品顯示,投資者預計美聯儲明年將把基準聯邦基金利率從目前的0.75%至1%上調至略高於3%。
央行在設定通脹目標方面的可信度更高,將吸引大部分資金流入。美聯儲終於發出了認真對待通脹問題的信號。
-英傑華投資者的分析師納菲茲·祖克説。
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美元佔據主導地位的另一個原因是:美國資產的表現一直好於歐洲資產。從全球股市可以看出這一點:過去10年,美國股市為投資者帶來了超高的回報,而歐洲股市的回報率一直較低,基本上在區間內波動。去年12月,標準普爾500指數自2009年以來上漲了400%以上,而同期斯托克歐洲600指數的漲幅為137%。
倫敦對衝基金Melqart Keal Capital的首席投資長迪卡盧奇(Keith DecarLucci)從事外匯市場交易已有30多年。他説,在地緣政治不確定性中,美元作為避風港的地位,以及作為世界儲備貨幣的角色,使其處於比上世紀70年代更有利的地位。上世紀70年代,美國進口了更多的石油,放棄了金本位制。
但摩根士丹利和巴克萊預計,這一數字將在今年內下降。策略師們説,隨着歐洲經濟增長提速,或者如果美國通脹率保持在3%以上,歐元看起來就不會那麼有吸引力。
寫信給Julia-Ambra Verlaine,電子郵件:julia.verlaine@wsj.com