We are seeing huge sell-offs in many asset classes today. It may be end-of-year profit-taking as traders head for their holiday vacations, or it may spell the end of the Dollar carry trade.
from Bloomberg:
Dec. 17 (Bloomberg) -- The dollar rose to the highest level against the euro in three months as declines in stocks stoked demand for the currency as a refuge amid concern European nations may struggle to pay their debts.
The Dollar Index, which the ICE futures exchange uses to track the greenback versus six major currencies, rose the most in two weeks as traders closed out bets against the dollar a day after the Federal Reserve said economic conditions had improved. The pound fell to a two-month low against the dollar after data showed U.K. retail sales unexpectedly dropped in November.
“It’s the first time in a year we look at the dollar with the potential to rise over an extended period,” said Steven Englander, chief U.S. currency strategist in New York at Barclays Plc, in a Bloomberg Television interview. “The same safe haven characteristics that helped the dollar in 2008, and hurt it from March through November, is helping it again. The gap in U.S. growth relative to Europe is beginning to widen.”
Ag Commodities
Dollar
Treasuries - after days of rising rates, this rise doesn't support end of carry trade idea
Stocks - tanking
