《经济学周刊》是美元制度的改变

Equity ResearchMacroeconomics 11 July 2025 Richard de Chazal, CFArdechazal@williamblair.com+44 20 7868 4489 Economics WeeklyIs This Dollar Regime Change? William Blair We believe the term “currency strategist” could often bedescribed as an oxymoron. Most studies show that for-ward exchange rates have little predictive power, and mostforeign-exchange forecasts are backward-looking; theychase momentum and the macro consensus, and their ac-curacy is even lower than most other economic forecasts.Thus, former Fed Chair Alan Greenspan used to say thatthe current spot rate is almost always the best estimate ofthe expected future rate. This is certainly true in the nearterm, when forecasting the exchange rate often comesdown to simply charting and technical analysis (lines ofsupport/resistance, chart patterns, oscillators, etc.). Overlonger term, however, currencies tend to adhere to theireconomic fundamentals, and therefore, the accuracy offorecasts tends to increase.In thisEconomics Weekly,wereassess the current dollar regime and why we mightnow be at a turning point for the currency. If we are now in a fourth major dollar bear market, thebull market peak looks to have been reached in October2022—the month prior to the midterm elections andabout halfway through the Fed’s tightening cycle. The per-formance since then has been relatively trendless, withthe dollar almost recovering that peak in January 2025.Since then, however, the dollar has started to declinequite sharply. The drawdown from the two-year highin the DXY dollar index has been 12% (exhibit 2), andyear-to-date the DXY index is 10.2% lower. If the currencywere to fall to its historical average, this would equate toa 17% decline from the current level. Dollar Bear Market and Regime Change The overwhelming consensus among economists at thestart of the year had been that the dollar will weakenduring 2025; unfortunately, such strong consensus oftenproves to be a good contrarian indicator, and while it hasbeen correct through the first half of the year, it would notbe surprising if the dollar recovers some of this earlierweakness through the second. This would also be con-sistent with some recent wins for the Trump administra-tion: the passage of the One Big Beautiful Bill Act (OBBB),progress in the Middle East, and trade agreements beingmade in principle with the U.K., China, and Vietnam—and,we are told, soon-to-be-announced deals with India andthe EU. In exhibit 1, we chart the performance of the real (in-flation adjusted) trade-weighted dollar against otheradvanced economies since the currency was depeggedfrom gold (1971) and officially fully floated in 1973. Asshown, the currency tends to move in major regimes, ofwhich there have been three major bull markets and threemajor bear markets, with the average length for each ap-proximately 8 years. During bull markets the dollar hasincreased an average of 55%, and during bear markets ithas fallen by an average of 30%. This decline raises two important questions: Is this nowthe start of another major dollar bear market? And, is thisalso the start of the end of the dollar being the world’sreserve currency of choice? Historically, dollar bull markets have tended to end badlyfor many of those countries that are linked to the curren-cy. For example, the early 1980s bull market ended with William Blair the Latin American debt crisis, and the 1990s bull marketended with the Asian crisis and the Russian debt default.As the dollar strengthens, countries that are pegged tothe dollar—often commodity-exporting emerging mar-kets—find their products becoming less internationallycompetitive. Meanwhile, they have also tended to bor-row in dollar-denominated debt, which has to be repaidin a more expensive currency at typically higher rates ofinterest. The fact that this past dollar bull market has notso far ended in a major emerging market crisis is a testa-ment to many of these economies learning the hard les-sons of the last Asian crisis. They have taken great painsto mend their balance sheets and to increase borrowingin domestic currencies. If this is the start of a major regime change to a dollarbear market and/or the waning influence of the dollar asthe world’s reserve currency, what might happen next? Changing Near-Term DynamicsNear-term shifts in the dollar following the global finan- cial crisis and the advent of quantitative easing seem tohave meant that the dollar has been driven more by risk-on/risk-off global capital flows, as opposed to changinginterest rate differentials, which is what typically drivessuch shifts in the currency. Following the Fed’s recenttightening cycle, the renewed start of easing, and widen-ing interest rate gaps between the U.S. and other foreigneconomies, interest rate differentials seem to be back inthe driver’s seat. Looking at the Bigger Picture The dollar has been declining and bond yields havemoved slightly higher—both in absolute terms, relativeto other fixed bonds