Need to Know: Why State Street is counseling you keep close tabs on the dollar
Investors have brushed off news that the Trump administration looks set to ban telecom equipment by Huawei Technologies, the Chinese tech company that’s been at the heart of U.S. security worries . The shift to optimism seems to have started with Wednesday’s news the White House will delay auto tariffs for Europe and Japan.
A weaker dollar can help steer investors toward higher yielding, though potentially riskier, emerging markets, while the reverse can be in the case of a stronger dollar, which also makes it tough for those countries to service dollar-denominated debt. “The dollar is an important barometer for how some of these risky trades are likely to play out,” he said.
Read: The woman who nailed the 2018 stock-market volatility blowup has kicked off an actively managed ETF
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