TechFlow, May 6 — According to Jinshi Data, among the 83 respondents surveyed by Reuters from April 30 to May 6, over 55% expressed concerns about the U.S. dollar's safe-haven status, a significant increase from about one-third in the April survey, although most acknowledged there is currently no clear alternative.
"I'm very concerned," said Steve Englander, Standard Chartered's global head of G10 foreign exchange research. "If you had asked me this question two months ago, I would have said that for the dollar, stimulus was primary and flows—regardless of whether they actually generated revenue—were secondary. Now it's clearly evident that markets are more worried about the long-term fiscal trajectory." Erik Nelson, macro strategist at Wells Fargo Securities, said: "We are more bearish on the dollar in the second half of this year. More people will recognize the weak hard data in the U.S., the Fed will cut rates as priced by markets, and concerns about capital outflows from U.S. assets and the Fed's independence may resurface."
Brian Rose, senior U.S. economist at UBS Global Wealth Management, said: "It all depends on the Federal Reserve's independence. If there are concerns that the Fed is losing its independence, that would seriously undermine the dollar's safe-haven status." "We see the yen or Swiss franc benefiting from the current situation—they are somewhat of a fallback safe haven."
