Lok Sang Ho

Has the Dollar Topped Out?

The US dollar is too strong. The yen is too strong. Today's Nikkei plunge is almost certainly due to the excessively strong yen. Free floating with capital flows that swing with a life of their own could be hazardous to the health of real economies. Wonder why the Bank of Japan and the Fed tolerate the unrealistically strong currencies. Certainly their weak economies and heavy debt load do not justify such strength. Japan's current account surplus had shrunk by a huge amount, and it is so export-dependent. The US already suffering from a plunge in consumption spending, certainly cannot afford to have exports undercut by a strong dollar. What are the central bankers up to?