Rumors Surfacing About the Death of The US Dollar

As written by Sandy Franks of

The U.S. dollar (USD) has been the world’s global reserve currency for over 70 years. It was given this elite status at the Bretton Woods Conference in 1944; otherwise known as the United Nations Monetary and Financial Conference.

At this conference 44 nations gathered together from July 1 to 22 in Bretton Woods New Hampshire. Their goal was to agree upon new rules for the post-WWII global monetary system.

The amount of debt England incurred during the war forced it to pass the global reserve currency status over to the United States

Why does having this status matter?

Being given this status allows a currency to be worth much, much more than any other country’s currency. A large part of having a global reserve currency is your currency becomes global in demand.

It is the international baseline currency for all trade. Countries are agreeing, in principle, to trade with your currency. Currently about 20 currencies peg their currencies to the dollar. Doing so, gives other countries a powerful medium of exchange.

six latest reserve currency countries

Six Latest Reserve Currency Countries

However, many countries, especially in East Asia, have stopped using the U.S. dollar for trading purposes.

Instead they are using “bilateral trade agreements” and they’re becoming popular these days. That’s prompted rumors that the U.S. dollar’s rein as “supreme currency” could soon come to an end.

Is this possible? Minneapolis Federal Reserve President Neel Kashkari said it’s possible the dollar could loose its status as the world’s reserve currency during his lifetime.

Let’s explore some of the challenges the U.S. faces in retaining this title.

Debt: Everyone knows that the U.S. has a debt problem. In fact, we’ve always had debt. In 1860, America’s debt was $65 million. The Civil War brought about a major spike in the debt. World War I and World War II also brought about major rises in the debt.

Although the amount has fluctuated, in recent years it has skyrocketed. We are now swimming in $19 trillion in national debt.

The U.S. owes almost US $3 trillion to just Japan and China alone. And regardless of whether Trump or Clinton wins the next election, the debt will only continue to grow.

Value of the Dollar: The value of the U.S. dollar has been in a downtrend for the last 31 years. The U.S. dollar index, which compares the greenback to the euro, yen, pound sterling, krona, franc, and Canadian dollar, has been trending lower since 1985.

Only over the past two years has the U.S. dollar increased in value relative to other major currencies. That’s not because the U.S. economy is doing so well; it’s that the other economies are doing worse.

Too Many Dollars: Another problem facing the U.S. dollar is that there is too much of it in circulation. The money supply started to increase in 1984; at the same time the value of the U.S. dollar started to decline against other world currencies.

To stimulate the economy following the Credit Crisis of 2008, the Federal Reserve announced three rounds of Quantitative Easing, a monetary policy that created trillions of dollars in new paper money.

Throughout history, countries that have continued printing more of their money eventually saw the value of that money collapse.

Negative Trade Balance: The U.S. has not had a positive balance of trade (exports minus imports) since 1976. That means since 1976 other countries have been exporting goods and services to us and we have been exporting our currency to them in return.

So if countries decided against the U.S. dollar as the reserve currency, what would they use instead?

Central bankers throughout the world, from Canada to Ireland, have recently suggested that they might issue a digital currency in the future.

There’s also the possibility of using the Chinese Yuan, also known as the Renminbi as the worlds’ reserve currency. Countries are trading so much Yuan that it has become the second most used currency in the world, passing the EURO in 2013.

If the USD is replaced, what happens to the U.S. economy? Without demand for the dollar, the end result would be a major currency devaluation and probably a drastic standard of living adjustment.

Could this actually happen? Anything is possible. These rumors have been around for a while but in recent years, they are getting louder and louder.

I hope the above forex currency trading information was of help to you.

Anthony at TradeCurrencyNow,
America’s Forex News and Currency Information source.

The above information is opinion based except where noted. Always contact a licensed professional for information on the above subject or BEFORE applying or practicing the above information.

Is Small Investor Money and Capital Getting Tight?

As reported by Brian Chappatta at

The municipal-bond market is forcing high-yield borrowers to scrap their junk.

The Florida Development Finance Corp. this week postponed a $1.75 billion unrated bond sale for All Aboard Florida, a passenger railroad backed by Fortress Investment Group LLC, that underwriters have been marketing since August. A Texas agency has delayed pricing $1.4 billion of speculative debt for a methanol plant since releasing offering documents Oct. 19. And the Puerto Rico Aqueduct & Sewer Authority, struggling to access capital as the island staggers toward default, couldn’t lure buyers even with yields of 10 percent.

The struggle to sell the munis mirrors the slowdown in the corporate-debt market for much of the year amid signs of a weakening Chinese economy and declining commodity prices. With speculation growing that the Federal Reserve will raise interest rates for the first time in nearly a decade and Puerto Rico’s fiscal crisis escalating, the flow of money into funds that invest in the riskiest munis has slowed to $1.2 billion this year, compared with $8.8 billion in 2014, Lipper US Fund Flows data show.

“You’re not seeing a tremendous amount of money coming in and really burning a hole in people’s pockets,” said Mark Paris, who runs a $7.3 billion high-yield muni fund from New York at Invesco Ltd. He said he or a colleague visited Florida and Texas to analyze the rail and methanol offerings, though he declined to say whether he’ll buy the bonds. “Size is becoming an issue — you’re not going to have every high-yield fund in these. There are only a certain amount of bonds funds can take.”

Large junk-bond deals are rare in the $3.7 trillion municipal market, which is mostly made up of states, cities, counties and school districts at little risk of defaulting. Until Puerto Rico issued $3.5 billion of general obligations last year, the biggest speculative-grade deal was $1.2 billion.

There are only 12 open-end funds focused on high-yield munis that have more than $1 billion in assets, data compiled by Bloomberg show. Many have large stakes in investment-grade borrowers like California, which has had its credit rating raised repeatedly since the recession as its finances improved.

By contrast, All Aboard Florida’s bonds are unrated, which is an indication they’d receive a junk rating. It’s parent, Florida East Coast Industries, was ranked seven steps below investment grade by Standard & Poor’s last year. The methanol-plant bonds for OCI N.V.’s Natgasoline LLC will probably have a rank three steps below investment grade, according to David Ambler, who analyzes high-yield munis at AllianceBernstein Holding LP in New York. The Puerto Rico agency, known as Prasa, has the third-lowest mark, Caa3, from Moody’s Investors Service.

Size An Issue

“The biggest issue that’s postponing these deals is just the absolute size of each one, and they’re certainly speculative,” said Mike Petty, manager of the $1.8 billion MainStay High Yield Municipal Bond Fund. “It’ll be difficult to get that many bonds done within our space. The underwriters have been trying to get crossover interest as well.”

With Puerto Rico veering toward default, some hedge funds and distressed-debt buyers may be leery of buying more high yield munis, said Invesco’s Paris. Such investors, know as crossover buyers because they’re not limited to specific markets the way mutual funds frequently are, hold as much as a third of the island’s $70 billion of debt, according to Mikhail Foux at Barclays Plc. Puerto Rico’s bonds have slumped more than 10 percent this year.

“There’s a lack of crossover hedge fund buyers who can come in and take up the slack of what the tax-exempt buyers don’t buy, and that’s slowed down the order process,” said Paris, whose fund has gained 3.8 percent this year, beating 93 percent of its high-yield peers. “I’ve been surprised at how long people have talked about these deals.”

High-yield munis have delivered lackluster gains this year. They’ve returned 0.8 percent, about half what was seen in the broad municipal market, Barclays data show. That’s partly because of Puerto Rico, whose bonds make up at least 25 percent of the index.

Gauging Risk

The offerings that have struggled to find buyers carry more risk than typical munis.

Puerto Rico’s sewer agency, which shelved a $750 million sale, could be swept up in the commonwealth’s debt restructuring, with Governor Alejandro Garcia Padilla seeking to persuade investors to accept less than they are owed. All Aboard Florida would be the first new privately run U.S. passenger railroad in more than a century, a project whose success will hinge on travelers’ willingness to abandon their cars in favor the 235-mile (378-kilometer) train line running from Orlando to Miami. The methanol plant is an effort to break into a business dominated by foreign competitors.

All Aboard Florida spokeswoman Melissa Shuffield didn’t return phone calls seeking comment. Omar Darwazah, a spokesman for OCI, didn’t respond to a phone call and e-mail seeking comment.

With interest rates near generational lows and the Federal Reserve signaling it may end its almost seven-year policy of keeping borrowing costs close to zero, investors are rightfully slow to commit to new deals, said Jim Murphy, who manages T. Rowe Price’s $3.3 billion high-yield fund from Baltimore.

“It’s that much more important to be careful when spreads are tight and rates are low like the environment we’re in,” Murphy said. “People are being really careful and that’s refreshing.”

I hope the above forex currency trading information was of help to you.

Anthony DiChi at TradeCurrencyNow,
America’s Forex News and Currency Information source.

The above information is opinion based except where noted. Always contact a licensed professional for information on the above subject or BEFORE applying or practicing the above information.

One of Four Financial / Stock Market Scenarios Will Happen

Below I have listed four possible economic situations that I believe currently have a high potential of coming to reality.

1) Inflation kicks in hard and fast.
Inflation must grow to support current and future growth of the Dow Jones Industrial Index prices.

I’m thinking the Feds are trying hard to pull this one off by printing dollars and are counting on this to help solve the debt problem. The FED hopes that printing dollars will also help jumpstart the world economy and help the USA maintain a strong financial currency position. It’s an all or nothing approach.


2) Sharp Stock Market Correction Coming.
No inflation means no support for inflated stock prices.

This theory works against everything the Federal Reserve is counting on. It will mean that the Fed has failed to accomplish their above goal.


3) Major expansion of world economic growth.
Expansion of economic markets world wide will help support the elevated prices of the mostly international stocks in the DOW Jones Industrial Index. Cost of hard goods goes up with some off setting efficiency plays.

An orderly world order must be maintained for this scenario to play out. As of today world order is going in the opposite direction.


4) International conflict syndrome.
This is when essentials inflate and stocks drop fast and hard. Conflicts disrupt the sensitive trade routes around the globe.

This is a world war three type scenario and if US policy doesn’t change fast this can become reality quickly.

More likely than not (three out of four indicate inflation) I’m thinking inflation is coming and your trading and retirement plans should account for inflation.

I hope the above forex currency trading information was of help to you.

Anthony DiChi at TradeCurrencyNow,
America’s Forex News and Currency Information source.

The above information is opinion based except where noted. Always contact a licensed professional for information on the above subject or BEFORE applying or practicing the above information.

Is Now the Time to Buy Gold and Silver

Today gold is trading at about 1,330 U.S. Dollars.

My information and charts indicate that Gold has a target low of 1050 U.S. Dollars with a low range from $950.00 to $1,180.00.

My information and charts indicate that Silver has a target low of 17.80 U.S. Dollars with a low range from $16.00 to $19.00.

Here is a link to my last opinion on gold.

I hope the above forex currency trading information was of help to you.

Anthony DiChi at TradeCurrencyNow,
America’s Forex News and Currency Information source.

The above information is opinion based except where noted. Always contact a licensed professional for information on the above subject or BEFORE applying or practicing the above information.

Why the Euro Zone and EU Might Help Unite Europe !

The European Union (EU) and the Euro Zone (EZ) are made up of countries. These countries are not states similar to the states in the United States. The states in the USA were and are designed to work with a central government.

The European Zone (EZ) and it’s counter part the Eurpean Union (EU) are a much more loosely put together central ruling body with no real bite because EZ member states (countries) are sovereign nations. This is why it is difficult for EU to operate efficiently as one Centralized Europe as does the USA’s central government in Washington D.C.

Now; let us look at the current situation in Europe’s EZ. Some say Greece and the rest of the PIIGS (Portugal, Ireland, Italy, Greece, Spain) nations might flee the EZ. My question is this “flee and then do what” ? It is my belief that the PIIGS as well as other EZ nations will be “force negotiated” into accepting diminished sovereign rights in exchange for bailouts and continued inclusion in the EZ. These new agreements will essentially bring the smaller and less efficient EZ member countries closer to a state level instead of a expensive, inefficient, economic rouge sovereign nation as is currently the situation. Will all nations accept these new terms? No, but almost all will to some degree or another. Is this a totally stable situation? No, but neither where the thirteen original state colonies of the USA.

Was this seek, destroy and absorb small and less efficient sovereign EZ Nations by design. Well, I do not want to be called a conspiracy theorist so I’ll leave that call up to you to decide. One thing you can be sure of is that the German Region will have much to say about how the new, more centralized EZ is governed and thus they will have accomplished much of what Germany could not do with two world wars. The French need not worry as they will be spared to some extent as long as they cooperate in the early stages.

EITHER WAY; at some point in the future the EZ and EU will be a lean, more streamlined and efficient union. Will the Euro survive? Yes, as long as the fiat money system survives. Will it go down in value? Yes. Will it go up in value? Yes.

I hope the above currency trading information was of help to you.

Anthony DiChi at TradeCurrencyNow,
America’s Forex News and currency information source.

Fascinating Forex Market Correlations You’ll Want to Use

Received from the and written by Jim Wyckoff.

Experienced futures traders know there are many correlations among futures markets—some of which are valuable guides in helping to determine specific market trends, and some of which are fickle. This educational feature will examine some basic correlations among futures markets, and will likely be most beneficial to the less-experienced traders. However, it just might be a good refresher for the experienced traders who may have forgotten a few of the market correlations.

It is important to emphasize that market correlations are never 100% predictable, and that some market correlations can and do make 180-degree turns over a period of time.

U.S. Dollar-Gold: The gold market and the dollar usually trade in an inverse relationship. This has been the case for many years. During times of U.S. economic prosperity and lower inflation, the dollar will usually benefit as money flows into U.S. paper assets (stocks and bonds), while physical assets (gold) are usually less attractive. Conversely, during times of weaker U.S. economic growth, higher inflation or heightened world economic or political uncertainty, traders and investors will tend to flock out of “paper” assets and into “hard” assets such as gold. Inflation is a bullish phenomenon for gold.

U.S. Dollar-U.S. Treasury Bonds: Usually, a stronger dollar means a stronger bond market because of good demand for U.S. dollars (from overseas investors) to buy U.S. T-Bonds. T-Bonds are also seen as a “flight-to-quality” asset during times of economic or political instability. In the past, the U.S. dollar has also benefited from “flight-to-quality” asset moves. However, since the major terrorist attacks on the U.S. and the resulting damage to the U.S. economy, the safe-haven status of the “greenback” has been much less pronounced.

Crude Oil-U.S. Treasury Bonds: If crude oil prices rally strongly, that is a negative for U.S. T-Bond prices, due to notions that inflationary pressures could reignite and become problematic for the economy. Inflation is the arch enemy of the bond market. Rising crude oil prices are also bullish for the gold market.

CRB-U.S. Treasury Bonds: The CRB Index is a basket of commodities melded into one composite price. A rising CRB index means generally rising commodities prices, and increasing inflation. Thus, a rising CRB Index is negative for U.S. Treasury Bond prices.

U.S. Stock Indexes-U.S. Treasury Bonds: Since the bull market in U.S. stocks ended just over two years ago, stock index futures prices and U.S. Treasury bond futures prices have traded in an inverse relationship. When stock prices are up, bond prices are usually down. However, during the long bull market run that preceded the current bear market, stock and bond prices traded in tandem. In fact, years ago, before all the electronic overnight futures trading had begun, the best way to get a good read on how the stock indexes would open was by early trading in the T-bond market. (T-Bond trading opens 70 minutes before the stock indexes).

Silver-Soybeans: This corollary may be more fiction than fact, at least nowadays. But during the “go-go” days of soaring precious metals and soybean prices, it was said that if soybean futures would lock limit-up, bean traders would buy silver futures.

Cattle-Hogs: The point to mention here is that if strong price gains or losses occur in one meat futures complex, there is likely to be somewhat of a spillover effect in the other meat complex. For example, sharp losses in the cattle or feeder cattle futures will likely weigh on the hogs and pork bellies.

Currency Futures-U.S. Dollar Index: Most major IMM currency futures contracts are “crossed” against the U.S. dollar. Thus, when the majority of the currencies are trading higher, it’s very likely that the U.S. Dollar Index will be trading lower. It’s a good idea for currency traders to keep a watchful eye on the U.S. Dollar Index, as it’s the best barometer for the overall health of the U.S. dollar versus major foreign currencies.

U.S. Stock Indexes-Lumber: Lumber is a very important commodity for the U.S. economy. It is literally a building block for the nation. If the stock market is sharply higher, lumber futures prices will be supported. A big sell off in the stock market will likely find selling pressure on lumber futures.

N.Y. Cocoa-British Pound: London cocoa futures trading is as important (or even more important) than New York cocoa futures trading, on a worldwide basis. London cocoa futures trading is conducted in the British pound currency. Thus, big fluctuations in the pound sterling will impact the price of U.S. cocoa futures, due to the cross-currency fluctuations of the British pound versus the U.S. dollar. Keep in mind there is constantly arbitrage taking place between the New York and London cocoa markets, and thus the currency cross-rates between the pound and the dollar are very important.

Grains-U.S. Dollar Index: A weaker U.S. dollar will be an underlying positive for the U.S. grain futures markets because it makes U.S. grain exports more competitive (cheaper prices) on the world market. Larger-degree trends in the U.S. dollar will have a larger-degree impact on the grains.

I hope the above currency trading information was of help to you.

Anthony DiChi at TradeCurrencyNow,
America’s Forex News and currency information source.

Difference Between Euro and Euro Dollar

As received from

These are quite different things. Be careful not to confuse the two!

The euro is the currency of European Monetary Union (European Countries).

Euro dollar refers to bonds that are issued by companies in US dollars outside the US. Let’s say a global company wants to raise money from non-US investors and issues a bond traded in, say, Europe or Asia. The interest and principal on the bond are paid in dollars.
The name “Eurodollar” is because this market was historically concentrated in Europe, but it is now global.

I hope the above currency trading information was of help to you.

Anthony DiChi at TradeCurrencyNow,
America’s Forex News and currency information source.

LIBOR definition, how does it effect the Forex Markets ?

Received from the Daily and written in part by Eric Fry

“The signs of credit distress are increasing.

One of the most telling forms is the direction of LIBOR interest rates. LIBOR stands for “London Interbank Offered Rate.” It is the rate at which banks borrow unsecured funds from other banks in the London wholesale money market (or interbank lending market).

In most circumstances, LIBOR rates track short-term Treasury rates. But in the midst of crisis conditions, LIBOR rates tend to spike, while Treasury rates fall. That’s exactly what happened during the credit crisis of 2008.

During the last few weeks, LIBOR rates have been on the rise once again. They have not risen high enough to sound a distress signal, but they have risen high enough to raise an eyebrow.

Let’s call it an early warning sign.

This warning sign is still flashing amber. Since our warning in early September, LIBOR rates have continued their steady upward climb, which indicates that credit stresses are increasing.

Meanwhile, government bond yields in the PIIGS nations of Portugal, Italy, Ireland, Greece and Spain are also surging higher — another clear sign of distress.”

I’ve been told that LIBOR is also referred to as the London Inter Bank Overnight Rate. The rate which banks loan each other funds.

Here is how LIBOR is described by Wikipedia; The LIBOR rate is the average interest rate that leading banks in London charge when lending to other banks. It is an acronym for London Interbank Offered Rate (LIBOR, /ˈlaɪbɔr/) Banks borrow money for one day, one month, two months, six months, one year etc. and they pay interest to their lenders based on certain rates. The LIBOR figure is an average of these rates. Many financial institutions, mortgage lenders and credit card agencies track the rate, which is produced daily at 11 a.m. to fix their own interest rates which are typically higher than the LIBOR rate. As such it is a benchmark for finance all around the world.

I hope the above currency trading information was of help to you.

Anthony DiChi at TradeCurrencyNow,
America’s Forex News and currency information source.

The Euro, ECB and the EuroZone

Received from and written by Nouriel Roubini

NEW YORK – The eurozone crisis seems to be reaching its climax, with Greece on the verge of default and an inglorious exit from the monetary union, and now Italy on the verge of losing market access. But the eurozone’s problems are much deeper. They are structural, and they severely affect at least four other economies: Ireland, Portugal, Cyprus, and Spain.

For the last decade, the PIIGS (Portugal, Ireland, Italy, Greece, and Spain) were the eurozone’s consumers of first and last resort, spending more than their income and running ever-larger current-account deficits. Meanwhile, the eurozone core (Germany, the Netherlands, Austria, and France) comprised the producers of first and last resort, spending below their incomes and running ever-larger current-account surpluses.

These external imbalances were also driven by the euro’s strength since 2002, and by the divergence in real exchange rates and competitiveness within the eurozone. Unit labor costs fell in Germany and other parts of the core (as wage growth lagged that of productivity), leading to a real depreciation and rising current-account surpluses, while the reverse occurred in the PIIGS (and Cyprus), leading to real appreciation and widening current-account deficits. In Ireland and Spain, private savings collapsed, and a housing bubble fueled excessive consumption, while in Greece, Portugal, Cyprus, and Italy, it was excessive fiscal deficits that exacerbated external imbalances.

The resulting build-up of private and public debt in over-spending countries became unmanageable when housing bubbles burst (Ireland and Spain) and current-account deficits, fiscal gaps, or both became unsustainable throughout the eurozone’s periphery. Moreover, the peripheral countries’ large current-account deficits, fueled as they were by excessive consumption, were accompanied by economic stagnation and loss of competitiveness.

So, now what?

Symmetrical reflation is the best option for restoring growth and competitiveness on the eurozone’s periphery while undertaking necessary austerity measures and structural reforms. This implies significant easing of monetary policy by the European Central Bank; provision of unlimited lender-of-last-resort support to illiquid but potentially solvent economies; a sharp depreciation of the euro, which would turn current-account deficits into surpluses; and fiscal stimulus in the core if the periphery is forced into austerity.

Unfortunately, Germany and the ECB oppose this option, owing to the prospect of a temporary dose of modestly higher inflation in the core relative to the periphery.

The bitter medicine that Germany and the ECB want to impose on the periphery – the second option – is recessionary deflation: fiscal austerity, structural reforms to boost productivity growth and reduce unit labor costs, and real depreciation via price adjustment, as opposed to nominal exchange-rate adjustment.

The problems with this option are many. Fiscal austerity, while necessary, means a deeper recession in the short term. Even structural reform reduces output in the short run, because it requires firing workers, shutting down money-losing firms, and gradually reallocating labor and capital to emerging new industries. So, to prevent a spiral of ever-deepening recession, the periphery needs real depreciation to improve its external deficit. But even if prices and wages were to fall by 30% over the next few years (which would most likely be socially and politically unsustainable), the real value of debt would increase sharply, worsening the insolvency of governments and private debtors.

In short, the eurozone’s periphery is now subject to the paradox of thrift: increasing savings too much, too fast leads to renewed recession and makes debts even more unsustainable. And that paradox is now affecting even the core.

If the peripheral countries remain mired in a deflationary trap of high debt, falling output, weak competitiveness, and structural external deficits, eventually they will be tempted by a third option: default and exit from the eurozone. This would enable them to revive economic growth and competitiveness through a depreciation of new national currencies.

Of course, such a disorderly eurozone break-up would be as severe a shock as the collapse of Lehman Brothers in 2008, if not worse. Avoiding it would compel the eurozone’s core economies to embrace the fourth and final option: bribing the periphery to remain in a low-growth uncompetitive state. This would require accepting massive losses on public and private debt, as well as enormous transfer payments that boost the periphery’s income while its output stagnates.

Italy has done something similar for decades, with its northern regions subsidizing the poorer Mezzogiorno. But such permanent fiscal transfers are politically impossible in the eurozone, where Germans are Germans and Greeks are Greeks.

That also means that Germany and the ECB have less power than they seem to believe. Unless they abandon asymmetric adjustment (recessionary deflation), which concentrates all of the pain in the periphery, in favor of a more symmetrical approach (austerity and structural reforms on the periphery, combined with eurozone-wide reflation), the monetary union’s slow-developing train wreck will accelerate as peripheral countries default and exit.

The recent chaos in Greece and Italy may be the first step in this process. Clearly, the eurozone’s muddle-through approach no longer works. Unless the eurozone moves toward greater economic, fiscal, and political integration (on a path consistent with short-term restoration of growth, competitiveness, and debt sustainability, which are needed to resolve unsustainable debt and reduce chronic fiscal and external deficits), recessionary deflation will certainly lead to a disorderly break-up.

With Italy too big to fail, too big to save, and now at the point of no return, the endgame for the eurozone has begun. Sequential, coercive restructurings of debt will come first, and then exits from the monetary union that will eventually lead to the eurozone’s disintegration.

Nouriel Roubini is Chairman of Roubini Global Economics, Professor of Economics at the Stern School of Business, New York University, and co-author of the book Crisis Economics.

I hope the above currency trading article was of help to you.

Anthony DiChi at TradeCurrencyNow,
America’s Forex News and currency information source.

Singapore Dollar

Received from Currency Cross Trader.

The Singapore dollar is the Asian version of the Swiss franc, but with one big advantage. Singapore’s central bank, the Monetary Authority, has not been intervening to prevent the currency from strengthening.

Just like the Swiss franc, the Singapore dollar is also backed by an incredible financial firepower. As Sean Hyman, Editor of Currency Cross Trader, has written here before, Singapore is already set up to be the world’s next Wall Street.

One of the best ways to measure that power is by looking at foreign currency reserves. The larger the reserves are, the safer the economy. There has been a tremendous growth in Singapore’s reserves over the last decade. That’s what makes the Singapore dollar a safe-haven currency.

It’s not easy to trade currencies from Asia. It’s impossible for retail investors to trade currencies such as the Chinese yuan, the Indonesia rupiah, and the South Korean won.

And most Asian currency pairs that are available to retail traders, like you and me, don’t move much. The Hong Kong dollar and Thai baht, for example, don’t move much because their central banks keep them on a tight leash.

The Singapore dollar is the exception. The MAS is much more flexible. The currency tends to fluctuate more than the other Asian currencies, so it’s the best Asian currency to trade.

I hope the above currency trading article was of help to you.

Anthony DiChi at TradeCurrencyNow,
America’s Forex News and currency information source.