VGIT - 2 Sides To The U.S. Dollar Story
Where is the U.S. dollar headed after its sizable appreciation in 2018? It depends on your vantage point. The dollar has gained against most developed market ((DM)) currencies, but depreciated against emerging market ((EM)) counterparts so far this year. We see this trend as likely to run on in the short term in the absence of policy surprises.
Chart of the week
Yield differentials and year-to-date currency performance vs. U.S. dollar
Sources: BlackRock Investment Institute, with data from Bloomberg and Thomson Reuters, as of February 2019.
Notes: We use two-year government bond yields as a