This is a systemic repricing of the world’s reserve currency, and I’ve been tracking the flows.
DXY is down ~10.7% YoY and is sitting around ~96.
If you get paid in USD, this is where things get worse…
Over the last 12 months:
USD/CHF: -14.1%
USD/EUR: -12.15%
USD/AUD: -9.57%
USD/CNY: -4.05%
If you live in Europe and invested in the S&P 500 a year ago… congrats. You made 0% profit.
The S&P 500 isn’t going up, the U.S. dollar is getting weaker.
And it’s not just one or two pairs.
USD is sliding across G10, broad weakness across multiple crosses and the trade-weighted index.
Why is this happening?
1. Debt Overhang:
US total debt is now ~$38.5T (with ~$30.8T held by the public). Absolutely insane.
2. Rate Divergence:
Fed funds target range upper bound: 3.75%
ECB deposit facility: 2.00%
SNB policy rate: 0%
RBA cash rate: 3.6%
China 1Y LPR: 3.0%
3. Geopolitics:
Markets are repricing policy risk. Trade threats, Fed-independence, and geopolitical volatility are pushing flows into havens (CHF/gold), and out of crowded USD longs.
What happens next?
1. Imported Inflation:
A weaker dollar makes imports more expensive. It tends to hit import prices first, then filters into CPI with a lag, especially tradables and energy-sensitive goods.
2. The Hard Asset Bid:
When the denominator (USD) breaks, the numerator (Gold, BTC, Commodities) flies. We’re moving into a tangible asset rotation.
3. Emerging Markets Rally:
A weak dollar relieves debt pressure on developing nations. Watch for massive inflows into EM equities.
Asset owners are the only winners here.
DO NOT SAVE MONEY. That’s the biggest mistake you can make.
The next few days will be INSANE. Don’t worry, I’ll keep you updated on everything.
Btw, I called every major market top and bottom of the last 10 YEARS, and i’ll call my next move publicly like I always do.
A lot of people will wish they followed me earlier.