Tina Fey’s Take: Dollar’s Dive Takes a Break Before the Encore Performance 🎭💰

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Hey there, fellow financial aficionados! It’s your girl Tina Fey, and I’ve got some hot gossip straight from the banking world. Morgan Stanley, the financial titan that’s been around longer than my career, is whispering that the US dollar’s nosedive is just on a coffee break before it takes another plummet. 🚀🔥

In their latest memo, which I’m sure they wrote while sipping lattes and wearing perfectly tailored suits, Morgan Stanley points out that the dollar had its worst first half since 1973. That’s like saying it’s been having a worse year than my last SNL sketch. 😂

As of right now, the dollar index (DXY) is sitting pretty at 98.15, which is down nearly 11% since January. Ouch! That’s like losing a significant portion of your favorite snack. 🍪😢

David Adams, the head of G10 FX Strategy at Morgan Stanley (and probably a fan of 30 Rock), says we’re not seeing the end of this dollar drama. He quips, “We’re likely at the intermission rather than the finale… The second act for the dollar’s weakening should come over the next 12 months, as U.S. interest rates and growth converge with those of the rest of the world.” Translation: The dollar’s not done falling, folks. Get your popcorn ready. 🍿

But wait, there’s more! Despite a brief rally in July, Morgan Stanley’s chief global FX strategist, James Lord (who probably has a better sense of humor than me), warns that the dollar is still under pressure. Why? Well, it’s a mix of labor market woes, tariff uncertainties, and the possibility of Fed Chair Jerome Powell being replaced sooner than a Netflix binge. 📈📉

Lord adds, “If we see more evidence over the summer that tariffs are increasing inflation, then it’s possible the dollar will receive more support. Yet, recent evidence of labor market weakness combined with policy uncertainty in the U.S., such as tariff negotiations and the recent debate about an early change in the Fed’s leadership, remains a source of downward pressure on the dollar.” In other words, the dollar’s got a lot of enemies right now. 😬

And if you thought that was bad, get this: According to Morgan Stanley’s data, foreign holders of US assets are starting to hedge their bets. They’re basically saying, “We don’t trust the dollar to hold its value, so we’re covering our bases.” Says Adams, “The initial data suggest that hedging has picked up in the second quarter, but because of the size of US asset holdings and given how much it was initially unhedged, we could be talking about a significant long-term flow… We have a lot more to go from here.” So, the dollar’s not just taking a breather-it’s gearing up for a marathon. 🏃‍♂️💨

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2025-08-09 19:14