Dollar smile theory

The US currency acts in the same way during recessions

Global economy is cyclic. The US dollar allows other currencies to take the lead in the period of GDP growth or recovery, but when it comes to a recession, the dollar hogs the blanket. The reason is that the US economy is extremely important and the greenback plays the leading role in international settlements, gold and foreign currency reserves, Forex trading volumes and crossborder loans. A global recession makes investors forget about the influence of European macro statistics on the Euro’s rate or the influence of the BoJ’s policy on…<br /><p>Read full author’s opinion and review in blog of #LiteForex</p>